Excelpoint Technology Ltd SOARING AHEAD ANNUAL REPORT 2016
Excelpoint Technology Ltd
SOarING aHEaD
AnnuAl RepoRt
2016EX
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NO
LOG
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An
nu
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t 2016
contents
01Corporate Profile
04Operations Review
06Financial Highlights
08Sustainability Report
16Corporate Structure
17Regional Presence
19Financial Contents
12Board of Directors
02A Letter to Shareholders
07Financial Review
15Key Management
18Corporate Information
coRPoRAte PRoFILe
About EXCELPOINT TECHNOLOGY LTD(Company Registration No. 200103280C)
Excelpoint Technology Ltd (“Excelpoint” or the “Company”), together with its subsidiaries (the “Group”) is a leading
regional electronics components distributor providing quality components, engineering design services and supply
chain management to original equipment manufacturers (“OEM”), original design manufacturers (“ODM”) and
electronics manufacturing services (“EMS”) in the Asia Pacific region. It ranks among the Top 25 Global Franchised
Distributors List from EBN in 2016.
Excelpoint works closely with its principals to create innovative solutions to complement its customers’ products.
The Group has research and development (“R&D”) centres in both Singapore and China supported by a team of
professional engineers aimed at helping customers improve operational efficiency and cost effectiveness.
Established in 1987 and headquartered in Singapore, Excelpoint’s presence spans more than 25 cities across
Asia Pacific. Currently, we provide employment to more than 600 people of different nationalities. Our shares are
quoted on the Main-Board of the Singapore Exchange (“SGX”).
For more information about Excelpoint, please visit www.excelpoint.com
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 01
A LetteR toshARehoLdeRs
Dear Shareholders,
On behalf of our Board of Directors, I am pleased to announce that our team delivered a 19.3% growth in revenue, which rose from US$828.3 million in FY2015 to US$988.2 million at the close of FY2016. Our profit after tax of US$7.1 million for FY2016 was an increase of 62.0% from US$4.4 million in the previous year.
Our revenue for the Hong Kong (including China) and Singapore (including ASEAN and India) business units grew by 11.9% and 30.1% respectively.
In view of our results for the year 2016, the Board proposes an ordinary dividend of 2.5 Singapore cents per share, and a special dividend of 1.5 Singapore cents per share, subject to your approval at the forthcoming Annual General Meeting.
THE YEAr IN rETrOSPECT
Given the challenging business environment, our teams in both regions have worked hard to overcome headwinds and grow the business.
North Asia
This region remains the largest revenue contributor for Excelpoint, accounting for about US$551.1 million, which is approximately 55.8% of Excelpoint’s aggregated revenue. Despite the slowdown of the economy and challenges faced in the business operating environment such as the depreciation of the Renminbi (“RMB”), China saw growth in the field of electronics manufacturing, especially with the advent of the Internet of Things (“IoT”), Robotics and more. China’s smartphone labels have gained popularity, giving rise to increased domestic demand, and this contributed to our revenue growth in the mobile segment. China’s ‘Made in China 2025’ initiative with the goal to upgrade its domestic manufacturing chain also gave rise to the emergence of new opportunities in the industrial and instrumentation space, which is a key segment for us. We saw more opportunities coming from the smart home sector in China, which led to the increase in adoption of new reference solutions for smart audio and smart lighting developed by our R&D team.
Our dedicated team, together with our extensive network and deep customer relationships have contributed to the strong results this year.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201602
South East Asia and India
This region accounted for about US$437.2 million at the close of FY2016, which is equivalent to approximately 44.2% of the Excelpoint’s aggregated revenue. Despite the political uncertainties in this region, we continue to see growth led by globalisation and infrastructure developments. Our close working relationship with our partners in these markets have positioned us well to capture opportunities that arise.
We continue to be optimistic about the potential of the market in India. With the government’s initiatives such as ‘Make in India’, it is a rising platform for the growth of technology-related manufacturing companies. The recent direction from the government to provide a cashless economy has shown the importance of integrating hardware and software capabilities, which presents an opportunity for us. With India now placed in high growth trajectory, we foresee growth in the IoT related segments such as smart security, green energy for sustainability, and connectivity. With the advent of opportunities coming from the emerging markets, we have also expanded our footprints into new territories such as Sri Lanka, Pakistan and Bangladesh.
Our Strategy
As a regional distributor who seeks to add value to our partners, innovation is vital. In 2016, we signed a partnership with Tata Elxis as our software partner, as well as obtained the distributorship of Xilinx in India to enhance our solutions offering. To capture opportunities in the IoT segment, we set-up a dedicated team with the expertise and market knowledge to design solutions that can be applied to a broad range of applications. Ultimately, we strive to create an ecosystem that can take Excelpoint to greater heights and strengthen our position in the market. As we continue to grow our business organically, the Group is also looking for partnerships that can bring Excelpoint to the next level. We have, on 5 October 2016, completed a share placement raising S$7.8 million, which will be used mainly for our business expansion plans.
PrOSPECTS
The electronics industry will continue to see more opportunities arising, especially with new developments from our suppliers at the recent Consumer Electronics Show in Las Vegas in January 2017. In addition, the increasing attention on IoT and the rise of government initiatives across the markets we operate in present new business opportunities, and we are well-positioned to capture them.
We continue to see more mergers and acquisitions in the semiconductor industry. These consolidations have led to new opportunities such as increasing our product range offering, as well as new business prospects. As the global growth remains uncertain and challenges in the business environment persists, we will remain nimble and focused in order to ensure business sustainability and growth.
IN APPrECIATION
I would like to welcome Mr. Herbert Kwok Fei Lung (as an Executive Director), Mr. Tonny Phuay Yong Choon (as an Executive Director) and Ms. Joanne Khoo Su Nee (as an Independent Director) to the Board of Directors, and extend my appreciation to Mr. David Kok Fat Keung, who has stepped down as an Executive Director to focus on his personal commitments. I would like to thank Mr. Kok for his service to the Board and wish him all the best in all his future endeavours.
I would also like to thank all our Directors for their guidance in navigating the Group throughout the year. It is truly this concerted effort to work together as a team that will overcome challenges and propel Excelpoint to greater heights. Together with the members of the Board, I would like to thank my fellow employees, principals, customers, bankers, business associates and shareholders for your continued trust, support and confidence in Excelpoint.
Yours sincerely,
Albert Phuay Yong Hen Chairman and Group CEO
A LetteR toshARehoLdeRs
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 03
oPeRAtIonsReVIeW
NOrTH ASIA
Mobile and Computing Segment
This segment remains the top revenue contributor for the North Asia region. With the increasing popularity of the China smartphone labels in the domestic market, we saw an increase in demand coming from Memory components. We also saw an increase in the demand for the product line Qorvo, a key player in the Radio Frequency market, and it is highly used in majority of the China smartphone labels.
Industrial and Instrumentation Segment
We saw growth in mainly 3 sub-segments – Transmission and Distribution, Chemical Analyser and Environmental Instrumentation and Process Control. In 2016, there was an increase in new customers due to the recognition of our reference designs. Our value-add service allowed for more product mix, generating higher revenue in this segment. We also saw new applications that required our solutions and components in the industrial automation area, mainly in IoT and Robotics. As we see potential in this segment due to the increase in infrastructure and industrial projects, we stay focused at growing this segment.
Consumer Segment
Several new applications such as the True Wireless Stereo Drive by Apple’s new airpods and Smart Speakers for Smart Homes usage contributed to the increase in this segment. In addition, our strong expertise in this field has garnered recognition and we see increased demand for our solutions. This segment will continue to grow as we improve on our reference designs to fulfil market needs.
Lighting Segment
We saw growth in this area due to the focus across the region in infrastructure projects. These projects require Smart Lighting for Smart Homes and for energy conservation purposes. With a strong portfolio of product lines in this segment to cater to market needs, we expect the demand to continue in the following year.
SOuTH EAST ASIA AND INDIA
Consumer Segment
This segment is our top revenue contributor in this region contributed by the increased adoption of our solutions. With our strong expertise in the Bluetooth and Bluetooth Low Energy applications, which are used in automation and communication applications, we continuously improve our solutions for our audio customers. Our strong footprints in the region allowed us to retain our top customers in the wireless audio market and grow the demand for our wireless Bluetooth solutions.
Mobile and Computing Segment
The ‘Make in India’ government initiative has started to gain momentum with some of the local key players getting ready to build their own local PCBA. With our strong engagement with the local players and their ODMs, we have started designing-in to new products to gain market share, especially in the memory components. We believe that the market will continue to see growth as the demand for smart phones is on the rise with competitive 3G and 4G services now being made available by local service providers.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201604
Industrial and Instrumentation Segment
This segment remained resilient for FY2016 with our strong product portfolio. There are 3 key sub-segments that contributed to the segment growth:-
Infrastructure
The growth of this segment is due to the rise in government initiatives to improve and enhance the nation’s infrastructure. We have also added Xilinx into our product portfolio to enhance our offering for the industrial IoT segment. With the continued directions from the government for this segment, we forsee growth in this segment moving forward, especially with power adapters, embedded wireless-connected end products for infrastructure and automation applications.
e-Government Projects
With several government initiatives being announced in 2016, we saw growth in this segment. After the recent initiatives by India’s government on Digital India and demonetisation, India is moving towards a cashless economy, giving rise to the digitalising of the banking sector. This led to increase in the demand for our NXP’s smart card chips. Also, we saw a rise in our Point-of-Sale terminal demand, mainly in micro-ATMs for the retail sector. With our strong positioning in the India’s market and with ongoing collaborations with key customers to provide solutions in this region, we believe we are able to grow this segment.
Energy Harvesting
This segment saw continued growth as our strengths in Metering, Power and Connectivity remained strong. Our product lines have expanded significantly to meet the rising need for green energy in the emerging markets, and we believe we will see continued growth in this segment. Particularly in India, the government has recently launched a program called Ujwal Bharat with a vision of 24 hours power for all in order to illumintate the life of every Indian by 2022. With these initiatives, we see potential and will remain focused at growing our revenue in this segment.
Lighting Segment
This segment saw growth due to the rise in government’s infrastructure projects. With the continued price erosion and existing strong competition in this segment, the Group have taken caution in the selection of product lines to ensure that businesses are profitable. Moving forward, we will focus on niche segments like LED display demand for Railway projects, Lighting control gears and Drivers. We believe that the Lighting segment will continue to see more market demand owing to the increase in government-related projects.
oPeRAtIonsReVIeW
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 05
FInAncIALhIGhLIGhts
2016 2015 2014 2013 2012
result of Operations (uS$’000)
Total revenue 988,240 828,283 728,968 651,857 584,852
Profit before taxation 8,505 5,499 7,457 7,535 6,098
Profit after taxation attributable to equity holders 7,053 4,355 7,083 6,226 5,046
Earnings per share (cent) 6.65 4.26 6.97* 1.23 1.00
Return on equity (%) 10.33 7.62 12.60 12.01 10.42
Balance Sheets (uS$’000)
Shareholders' equity 68,258 57,183 56,227 51,860 48,420
Fixed assets 2,577 1,870 2,322 4,409 4,624
Intangibles 519 326 326 326 326
Current assets 303,936 258,761 221,501 183,269 159,903
Current liabilities 240,585 205,560 170,086 137,924 117,837
Net current assets 63,351 53,201 51,415 45,345 42,066
Borrowings 123,501 99,445 80,951 59,326 45,876
Net assets value per share (cent) 57.94 55.83 55.12* 10.22 9.59
Weighted average number of ordinary shares 105,999,041 102,214,069 101,573,225* 505,003,082 504,659,200
Number of ordinary shares 117,810,940 102,423,440 102,004,440* 507,578,200 504,659,200
* On 11 August 2015, the Company completed the consolidation of every five existing issued shares in the capital of the Company into one ordinary share in the capital of the Company. The weighted average number of ordinary shares used for the calculation of earnings per share for the comparatives have been adjusted for the effect of the share consolidation.
revenue By Geographical Locations revenue By Business Segments
2016 2016
US$'000 % US$'000 %
Hong Kong/ PRC 757,768 76.6% Hong Kong/ PRC 551,086 55.8%
Southeast Asia 181,549 18.4% (comprising Hong Kong and the PRC)
India 27,284 2.8% Southeast Asia 437,154 44.2%
Others 21,639 2.2% (comprising Singapore, Malaysia, Thailand, Philippines, Vietnam, India, Indonesia, New Zealand and Australia)
988,240 100.0% 988,240 100.0%
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201606
FInAncIALReVIeW
revenue (uS$’000)
The Group reported a 19.3% growth in total revenue, from US$828.3 million in FY2015 to US$988.2 million in FY2016. This is due to the higher revenue contributed by the North Asian, Southeast Asian and Indian markets.
584,852651,857
728,968828,283
988,240
2012 2013 2014 2015 2016
Profit After Taxation (uS$’000)
Net profit after tax amounted to US$7.1 million this year, which was higher than the US$4.4 million reported in FY2015. This was due to higher sales arising from stronger demand in FY2016.
5,046
6,2267,083
4,355
7,053
2012 2013 2014 2015 2016
Operational Efficiency
Overall operational efficiency improved in FY2016 due to the Group’s on-going efforts in managing its credit and inventory risk. Debtors’ turnover deceased from 55 days in FY2015 to 53 days in FY2016. Creditors’ turnover decreased from 40 days in FY2015 to 38 days in FY2016 reflecting the Group’s sound financial position. Inventory turnover decreased from 48 days to 47 days.
Debtors T/O(DAYS)
Creditors T/O(DAYS)
Inventory T/O(DAYS)
46 49 52 55 53
2012 2013 2014 2015 2016
43 40 39 40 38
2012 2013 2014 2015 2016
43 42 45 48 47
2012 2013 2014 2015 2016
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 07
sUstAInABILItYRePoRt
We aim to create sustainable value in everything we do and our 4 key sustainability drivers to achieving this are:-
Managing risks in our
business
stakeholder engageMent
supporting our
coMMunities
ensuring responsible
business operations
By effectively reviewing these key sustainability drivers, we make our business more resilient and our team more competent.
a) Managing risks in our business
Excelpoint believes strongly in the importance of identifying, analysing and managing risks in the organisation. With a strong risk management framework in place, it gives the business the ability to focus on its core, and it gives our stakeholders the confidence that the business is sustainable.
Enterprise Risk Management (“ERM”)
Risk management is a pertinent exercise that Excelpoint engages yearly. The Company has an ERM Framework and a risk management committee in place for the Group. The said Framework is reviewed by the Audit Committee (“AC”) and approved by the Board. The AC and the Board will assess the adequacy and effectiveness of the ERM framework and processes. With the feedback given, the committee, together with the management work on strategies to prioritise and mitigate the risks that are existent.
Excelpoint is committed to improving the economic and social well-being of our stakeholders. Being responsible in our operations and delivering sustainable growth has been a fundamental value embedded in our business practices both internally and externally.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201608
sUstAInABILItYRePoRt
Excelpoint is committed to improving the economic and social well-being of our stakeholders. Being responsible in our operations and delivering sustainable growth has been a fundamental value embedded in our business practices both internally and externally.
b) stakeholder engageMent
Stakeholder engagement is a very important element of sustainability governance as it ensures the Group is well positioned to identify, review and prioritise our sustainability efforts. We ensure our sustainability strategies and programs are in line with our shareholders’ perspectives and expectations. To achieve this, we promote various dialogues with a wide spectrum of stakeholders.
excelpoint’s stakeholders
shareholders customers governmentemployees suppliers
how we engage
our stakeholders
key Matters what we do
Employees - Remuneration- Welfare- Diversity- Communication
- Performance bonus and sales incentive- Long service awards- Employee share allocation programme (Excelpoint performance share
scheme and Excelpoint share option scheme)- Annual performance management (self and employer appraisal) - Performance improvement programme - Training and development opportunities- Recreation club - Ensuring diversity (62% of the workforce are males and 38% of the
workforce are females)- Safety and health (Excelpoint has achieved bizSAFE Level 3 certification)
Customers/ Suppliers
- Building Relationships
- Value-added Services
- Customer Relationship Management
- Timely feedback through quarterly (or more) reviews - Internal management reviews (to ensure we are fulfilling the needs of
both our suppliers and customers)
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 09
sUstAInABILItYRePoRt
our stakeholders
key Matters what we do
Shareholders and Investor Groups
- Communication- Timely
Reporting of Announcements
- Transparency- Compliance
- Dedicated Investor Relations page on website- Annual General Meetings/ Extraordinary General Meetings- Quarterly updated financial reports and annual reports - Press Releases on business related news- Information on new regulations are communicated to the Board to
ensure compliance
Government Bodies
- Communication - Participation in consultations, surveys, forums and roundtables- Participation in networking sessions held by the government- Attending talks and networking sessions held by government bodies to
understand the industry and share our perspectives
c) supporting our coMMunities
Year 2016 was another fruitful year as we were able to grow our contributions in different ways. As we continue to explore new opportunities to give back to the society, we have also focused our efforts on helping children and youths, and building the next generation of leaders.
singaporeThe Excelpoint Bursary, in collaboration with the Singapore Management University (“SMU”) continues in its third year (a total of S$52,000 dispersed annually for 5 years for the unprivileged students which started in 2014). Sponsorship of S$10,000 for Halogen Foundation’s Golf Charity Event in November 2016, whereby the proceeds will go to several programs that the foundation is building upon to help the youths in need. Excelpoint has worked closely with Halogen to play a part in the Network For Teaching Entrepreneurship (“NFTE”) Program, which is a core program under Halogen Foundation, to educate underprivileged children, aged between 15-19 years old about leadership and entrepreneurship. We have donated S$5,000 to the annual UOB Heartbeat Run/ Walk, whereby partners are invited to participate in their Annual Charity Run/ Walk to raise funds to help the needy.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201610
sUstAInABILItYRePoRt
chinaThis year, Excelpoint worked with Sowers Action on their Sending Love program, a continuation of the previous year. We donated approximately S$6,574 (HKD$36,000) to distribute 300 jackets to the disadvantaged children in the rural regions of China. This was a meaningful activity as the jackets were able to provide children with warmth and to tide them through the harsh winter.
d) ensuring responsible business operations
Excelpoint is committed to our environment, people and our stakeholders. We believe that being responsible in what we do can add value to our business.
Health and Safety
Excelpoint Systems (Pte) Ltd has attained bizSAFE Level 3 in 2014.
We are committed to continuously improve our health and safety management to eliminate injuries and illnesses at our workplace. We are in compliance with the regulatory requirements of the Workplace Safety Health Act (“WSHA”).
Standards and Compliances
All operations in Excelpoint implement Quality Management Systems (“QMS”), which is third party certified to the International Organisation for Standardisation (“ISO”). Excelpoint has achieved ISO 9001:2015 certification in June 2016 and it addresses all the management processes, key processes and support processes that are relevant in our operations (warehousing, stocking and supply of electronic components). This standard set the requirements necessary for our employees to ensure our customers’ satisfaction through the supply of high quality products and delivering the most professional services.
Personal Data Protection Act
Excelpoint respects employees’, suppliers’ and customers’ data privacy, and has a stringent process in place to ensure data is accessed only by authorised personnel and for authorised use only. With this policy, we are able to safeguard data and prevent them from being misused.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 11
BoARd oFdIRectoRs
1. Kwah Thiam Hock2. Albert Phuay Yong Hen3. Alan Kwan Wai Loen4. Joanne Khoo Su Nee
4 5 6 78
1 23
5. Sunny Wong Fook Choy6. Herbert Kwok Fei Lung7. Tonny Phuay Yong Choon8. Professor Low Teck Seng
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201612
BoARd oFdIRectoRs
ALBErT PHuAY YONG HEN is the founder, Chairman and Group Chief Executive Officer. He was appointed as an Executive Director on 18 May 2001 and was last re-elected on 6 April 2016. He is also a member of the Nominating Committee.
He oversees the general management of our business and is also responsible for our Group’s strategic direction, planning and business development.
Prior to forming Excelpoint Systems (Pte) Ltd (“ESPL”), Mr. Phuay held various management positions in several companies from 1977 to 1986.
Mr. Phuay holds a Technical Certificate in Electronics from the Institute of Technical Education in Singapore. He also received a Long Service Award certificate from the Ministry of Community Development and Sports in recognition of his voluntary contributions as a Probation Officer since 1985.
KWAH THIAM HOCK was appointed as an Independent Director on 18 April 2007 and was re-elected on 6 April 2016. He is the Chairman of the Audit Committee and also a member of the Remuneration Committee and Nominating Committee. He was appointed as Lead Independent Director on 28 February 2014 and a member of the Nominating Committee on 5 March 2015. Presently, Mr. Kwah also holds Independent Directorships at Wilmar International Limited, Teho International Inc Ltd, and IFS Capital Limited.
Mr. Kwah holds a Bachelor in Accountancy from the National University of Singapore. He is a Fellow CPA of Australian Society of Accountants and also a Fellow Member of both the Institute of Singapore Chartered Accountants and ACCA (UK).
ALAN KWAN WAI LOEN was appointed as an Executive Director on 18 May 2001 and was last re-elected on 8 April 2015. He advises and assists the business units on the strategic alliance within the Group.
Mr. Kwan holds a Diploma in Production Engineering from the Singapore Polytechnic, a Diploma in Marketing Management from the Ngee Ann Polytechnic and a Diploma from the Chartered Institute of Marketing in the United Kingdom.
HErBErT KWOK FEI LuNG was appointed as an Executive Director on 28 September 2016. He manages the businesses and operations in the North Asia region, which includes Hong Kong and the PRC. Mr. Kwok holds a Higher Diploma in Marine Electronics from the Hong Kong Polytechnic.
TONNY PHuAY YONG CHOON was appointed as an Executive Director on 28 September 2016. He oversees the Group’s sales, and the overall businesses and operations in the ASEAN region, including India, Australia and New Zealand. Mr. Phuay holds a Diploma in Electronics and Communications from the Singapore Polytechnic and a Postgraduate Diploma in Sales and Marketing from the Chartered Institute of Marketing in the United Kingdom.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 13
BoARd oFdIRectoRs
SuNNY WONG FOOK CHOY was appointed as an Independent Director on 13 November 2003 and was re-elected on 17 April 2014. He is the Chairman of the Remuneration Committee and a member of the Audit Committee and Nominating Committee. He is a practising advocate and solicitor of the Supreme Court of Singapore. He started his legal career in 1982. He is currently the Managing Director and shareholder of Wong Tan & Molly Lim LLC and WTML Management Services Pte Ltd.
Mr. Wong is a Director in the following public listed companies in Singapore: China Medical (International) Group Limited, Mencast Holdings Ltd, KTL Global Limited, Civmec Limited and Innotek Limited.
He holds a Bachelor of Laws (Honours) from the National University of Singapore.
JOANNE KHOO Su NEE was appointed as an Independent Director on 28 September 2016. She is a member of the Audit Committee. She has more than 20 years of experience in corporate finance and business advisory services and is currently a Director of Bowmen Capital Private Limited, a company that provides business and management consultancy services. From February 2008 to October 2012, she was a Director of corporate finance at Canaccord Genuity Singapore Pte. Ltd. (formerly known as Collins Stewart Pte. Limited). Prior to this, she was involved
in a wide range of corporate finance activities in the employment of Phillip Securities Pte Ltd and Hong Leong Finance Limited. From 2000 to 2004, she was with Stone Forest Consulting Pte Ltd where she was involved in providing consultancy services to companies seeking public listings in Singapore. From 1997 to 2000, she was with PricewaterhouseCoopers. During that period, she was involved in both the corporate finance and recovery department as well as the audit and business advisory services department. Presently, Ms. Khoo also holds Independent Directorships at Teho International Inc Ltd and Kitchen Culture Holdings Ltd. Ms. Khoo graduated with a Bachelor of Business in Accountancy from the Royal Melbourne Institute of Technology University in 1996. She was admitted as a Certified Public Accountant by the CPA Australia in 1999 and a Chartered Accountant under the Malaysian Institute of Accountants in 2000.
PrOFESSOr LOW TECK SENG was appointed as an Independent Director on 19 April 2006 and was re-elected on 8 April 2015. He is the Chairman of the Nominating Committee and a member of the Audit Committee and Remuneration Committee.
Professor Low is currently the Chief Executive Officer of the National Research Foundation, Singapore, an Independent Director at Singapore Post Limited and ISEC Ltd, and a tenured Professor at both the Nanyang Technological University and the National University of Singapore. He has also been appointed to the Board of Advisors of CORFO, Chile.
He holds a Bachelor of Science (First Class, 1978) and Ph.D (1982) from Southampton University, United Kingdom.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201614
KeYMAnAGeMent
1. STANLEY CHAN TuNG HONG is the Senior Vice President of Operations of ESPL, and Assistant to CEO. He is responsible for ESPL’s overall business activities in the ASEAN region, India and Australia/ New Zealand. He is also assisting the CEO in overall business strategies.
Mr. Chan holds a Bachelor Degree in Engineering (Electrical) awarded with Second Class Honours from the Nanyang Technological University, Singapore.
2. GE YI XIN is the Senior Vice President of Field Applications of ESHK. He is the head of Field Applications team in Hong Kong and China region, responsible for providing technical designs assistance, technical support and engineering consultancy services for customers.
Mr. Ge holds a degree in Automatic Manufacturing Systems from the Shanghai University of Technology and a Master of Engineering degree awarded by the same university.
3. ALAN TAN JING TIONG is the Vice President of Sales for the Hong Kong and China region. He is responsible for the overall sales performance and manages the sales teams in the region. Mr. Tan holds a Diploma in Electrical Engineering from Singapore Polytechnic.
4. WANG QING SHENG is the Director of Research and Development (R&D) for the Group. He oversees the R&D teams in Singapore and China, who are responsible for our reference solutions and application designs. Mr. Wang holds a Master Degree in IEEE (Institute of Electrical and Electronics Engineers) from Tsinghua University. After graduation, he lectured in Tsinghua University for two years. Since 1991, he has been in the electronics engineering industry working for several high-tech companies to design and develop wireless products and solutions.
5. PHuAY YONG HuA is the Group Senior Vice President of HR & Admin and oversees the human resources and administrative departments of the Group.
Mr. Phuay holds an Electronics Servicing Certificate from the Institute of Technical Education in Singapore.
6. IVAN LEE SEE THIAM is the Group Chief Financial Officer and oversees the overall financial activities of the Group.
Mr. Lee holds a Masters of Commerce (Accounting and Finance) from The University of Sydney, Australia and a Bachelor of Business Administration awarded with Merit from the National University of Singapore.
1 2 3
4 5 6
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 15
coRPoRAtestRUctURe
EXCELPOINT SYSTEMS SDN. BHD. (MALAYSIA) (100%)
EXCELPOINT SYSTEMS (INDIA) PVT LTD (INDIA) (100%)
EXCELPOINT SYSTEMS (PTE) LTD (AuSTrALIA BrANCH)
AUSTRALIA
rEPrESENTATIVE OFFICES INDIA – BANGALORE
INDONESIA – JAKARTA PHILIPPINES – MANILA THAILAND – BANGKOK
VIETNAM – HO CHI MINH CITY
EXCELPOINT INTErNATIONAL TrADING (SHENzHEN) CO., LTD. PrC
(100%)
EXCELPOINT INTErNATIONAL TrADING (SHANGHAI) CO., LTD. PrC
(100%)
BrANCHES/ OFFICES: BEIJING, CHENGDU, GUANGZHOU, NANJING,
QINGDAO, SHENZHEN, WUHAN, XIAMEN, XI’AN
Excelpoint Technology Ltd
EXCELPOINT SYSTEMS (PTE) LTD (SINGAPOrE)(100%)
EXCELPOINT SYSTEMS (H.K.) LIMITED (HONG KONG)(100%)
LIGHTS ELECTrONICS PTE LTD (SINGAPOrE)*(100%)
PLANETSPArK PTE LTD (SINGAPOrE)(100%)
* This company was struck-off during the year and deregistration is expected to be completed by March 2017.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201616
ReGIonALPResence
SINGAPOrEHeadquarters
AuSTrALIASydney
INDIABangaloreChennaiHyderabadMumbaiNew DelhiPune
INDONESIAJakarta
MALAYSIAKuala LumpurPenang
PHILIPPINESManila
THAILANDBangkok
VIETNAMHo Chi Minh City
CHINABeijingChengduGuangzhouHong KongNanjingQingdaoShanghaiShenzhenWuhanXiamenXi’an
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 17
coRPoRAteInFoRMAtIon
BOArD OF DIrECTOrS
Executive
Albert Phuay Yong Hen(Chairman and Group Chief Executive Officer)Alan Kwan Wai LoenHerbert Kwok Fei Lung#
Tonny Phuay Yong Choon#
David Kok Fat Keung*
Non-Executive
Kwah Thiam Hock (Lead Independent)Sunny Wong Fook Choy (Independent)Professor Low Teck Seng (Independent)Joanne Khoo Su Nee (Independent)#
AuDIT COMMITTEE
Kwah Thiam Hock (Chairman)Sunny Wong Fook Choy (Member)Professor Low Teck Seng (Member)Joanne Khoo Su Nee (Member)#
NOMINATING COMMITTEE
Professor Low Teck Seng (Chairman)Albert Phuay Yong Hen (Member)Sunny Wong Fook Choy (Member)Kwah Thiam Hock (Member)
rEMuNErATION COMMITTEE
Sunny Wong Fook Choy (Chairman)Kwah Thiam Hock (Member)Professor Low Teck Seng (Member)
COMPANY SECrETArIES
Tan Cher LiangWong Yoen Har
rEGISTErED OFFICE ANDBuSINESS ADDrESS
15 Changi Business Park Central 1#06-00Singapore 486057Tel: 65-6741 8966Fax: 65-6741 8980Website: www.excelpoint.comCompany Registration No. 200103280C
SHArE rEGISTrAr
Boardroom Corporate & Advisory Services Pte Ltd50 Raffles Place#32-01 Singapore Land TowerSingapore 048623Tel: 65-6536 5355Fax: 65-6536 1360
AuDITOrS
Ernst & Young LLPPublic Accountants and Chartered AccountantsOne Raffles QuayNorth Tower Level 18Singapore 048583
AuDIT PArTNEr-IN-CHArGE
Tham Chee Soon(Since financial year ended 31 December 2014)
# Appointed on 28 September 2016* Resigned on 6 February 2016
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201618
FINANCIAL C
ONTENTS
20Report on Corporate
Governance
39Directors’ Statement
44Independent Auditor’s
Report
49Consolidated Statement
of Comprehensive Income
54Consolidated Cash Flow
Statement
55Notes to the
Financial Statements
102Notice of Sixteenth
Annual General Meeting
50Balance Sheets
38Report of the
Audit Committee
48Consolidated Income
Statement
51Statements of Changes
in Equity
100Statistics of
Shareholdings
Proxy Form
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 19
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201620
REPORT ONCORPORATE GOVERNANCE
Excelpoint Technology Ltd (the “Company”), together with its subsidiaries (the “Group”) is committed to
having and maintaining high standards of corporate governance. The Company believes that good corporate
governance inculcates an ethical environment and enhances the interest of all shareholders. Since our
incorporation on 18 May 2001 and our subsequent admission to the Offi cial List of The Singapore Exchange
Securities Trading Limited (the “SGX-ST”), we have taken steps to comply with most of the guidelines of the
revised Code of Corporate Governance 2012 (the “Code”) and are working to adopt the other changes where
appropriate.
This Report describes the Company’s corporate governance processes and activities with specifi c reference
made to the principles and guidelines as set out in the Code.
BOARD MATTERS
Principle 1: THE BOARD’S CONDUCT OF AFFAIRS
The principal functions of the Board are:-
1.1 Approving the broad policies, strategies and fi nancial objectives of the Company and monitoring the
performance of management;
1.2 Overseeing the processes for evaluating the adequacy of internal controls, risk management, fi nancial
reporting and compliance;
1.3 Approving the nominations of Directors and appointment of key personnel;
1.4 Establishing framework of prudent and effective controls including safeguarding of shareholders’
interests and the Company’s assets;
1.5 Setting the Company’s values and standards including ethical standards and also ensuring that
obligations to shareholders and other stakeholders are understood and met;
1.6 Approving major funding proposals, investment and divestment proposals; and
1.7 Assuming responsibility for corporate governance.
The Directors on the Board have the appropriate core competencies and diversity of experience to enable
them, in their collective wisdom, to contribute effectively. Every Director is expected, in the course of carrying
out his or her duties and responsibilities, to act in good faith, provide insights and consider at all times the
interests of the Company.
The Company has adopted internal guidelines setting forth matters that are reserved and required for Board’s
decision and clear directions to management on matters that must be approved by the Board. The Board
makes decisions in material transactions such as major funding proposals, acquisitions and divestments,
disposal of assets, corporate or fi nancial restructuring, share issuances, dividends, annual budgets and
fi nancial plans of the Group, quarterly and annual fi nancial reports, internal controls and risk management
strategies and execution and other matters which require Board approval as specifi ed under the Company’s
interested person transaction policy.
The Board conducts regular scheduled meetings. Ad-hoc meetings are convened when circumstances require.
The Company’s Constitution allow a Board meeting to be conducted by way of telephone conference or by
means of similar communication equipment whereby all persons participating in the meeting are able to hear
each other. The Board has established three Board Committees to assist in the execution of its responsibilities,
they are the Audit Committee (“AC”), Remuneration Committee (“RC”) and Nominating Committee (“NC”).
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 21
REPORT ONCORPORATE GOVERNANCE
The Board met 4 times in FY2016 to review the Group’s business operations and fi nancial performance. The
attendance of each Director at meetings of the Board and Board Committees during the fi nancial year ended
31 December 2016 is disclosed as follows:-
Attendance at Board and Board Committee Meetings
BoardAudit Committee
(“AC”)Nominating
Committee (“NC”)Remuneration
Committee (“RC”)
Name of DirectorsNo. of
Meetings AttendanceNo. of
Meetings AttendanceNo. of
Meetings AttendanceNo. of
Meetings Attendance
Albert Phuay Yong Hen 4 4 – – 2 2 – –
Alan Kwan Wai Loen 4 4 – – – – – –
David Kok Fat Keung(1) 4 1 – – – – – –
Herbert Kwok Fei Lung(2) 4 1 – – – – – –
Tonny Phuay Yong Choon(2) 4 1 – – – – – –
Kwah Thiam Hock 4 4 4 4 2 2 2 2
Sunny Wong Fook Choy 4 4 4 4 2 2 2 2
Professor Low Teck Seng 4 4 4 4 2 2 2 2
Joanne Khoo Su Nee(2) 4 1 4 1 – – – –
(1) Mr. David Kok has resigned as Director of the Company with effect from 6 February 2016.
(2) Mr. Herbert Kwok, Mr. Tonny Phuay and Ms. Joanne Khoo were appointed as Directors of the Company with effect from
28 September 2016.
The Company is responsible for arranging and funding regular training for the Company’s Directors from time
to time particularly on changes in the relevant new laws, regulations and changing commercial risks to enable
them to make well-informed decisions and to ensure that the Directors are competent in carrying out their
expected roles and responsibilities. All the Directors are informed and encouraged to attend seminars, courses
and other programmes, particularly on relevant new laws, regulations and changing commercial risks, from
time to time, in order to discharge their duties as Directors. During the year, the Board was briefed and/ or
updated by the Company Secretary on the changes under the Code and other regulations. The Board has also
attended some training and continuing education/ courses on new legislations and/ or regulations during the
year.
The Company has conducted briefi ngs and orientation programmes to familiarise the newly appointed Director
with the various businesses, operations and processes of the Group. Further, the newly appointed Director had
been provided with a formal letter setting out her duties and obligations and appropriate training to ensure that
she is fully aware of her responsibilities and obligations of being a Director. The Company has also conducted
orientation programme to the newly appointed Director during the year.
Principle 2: BOARD COMPOSITION AND GUIDANCE
The Board currently comprises four Executive Directors and four Independent Directors. The Board has
examined its size and is satisfi ed that it is an appropriate size for effective decision making, taking into account
the nature and scope of the Company’s operations. The Independent Directors consist of respected individuals
from different backgrounds whose core competencies, qualifi cations, skills and experience are extensive and
complementary.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201622
REPORT ONCORPORATE GOVERNANCE
All appointments and re-elections of Directors are reviewed and recommended by the NC to the Board. The
independence of each Independent Director is reviewed by the NC annually in accordance with the guidelines
of the Code.
The Board of Directors is as follows:-
Directors
Albert Phuay Yong Hen (Chairman and Group Chief Executive Offi cer)
Alan Kwan Wai Loen (Executive)
David Kok Fat Keung(1) (Executive)
Herbert Kwok Fei Lung(2) (Executive)
Tonny Phuay Yong Choon(2) (Executive)
Kwah Thiam Hock (Lead Independent)
Sunny Wong Fook Choy (Independent)
Professor Low Teck Seng (Independent)
Joanne Khoo Su Nee(2) (Independent)
(1) Mr. David Kok has resigned as a Director of the Company with effect from 6 February 2016.
(2) Mr. Herbert Kwok, Mr. Tonny Phuay and Ms. Joanne Khoo were appointed as Directors of the Company with effect from
28 September 2016.
The four Independent Directors currently represent 50% of the Board. The Board considers an Independent
Director as one who has no relationship with the Company, its related companies or its offi cers, its 10%
shareholders or its offi cers that could interfere, or be reasonably perceived to interfere, with the exercise of
the Director’s independent business judgement with a view to the best interests of the Company. The
independence of each Director is reviewed annually by the NC. Each Independent Director is required to
complete a Director’s Independence Checklist annually to confi rm his independence based on the guidelines
set out in the Code. All four Independent Directors are independent of the management and 10% shareholders.
Although Mr. Sunny Wong Fook Choy, Mr. Kwah Thiam Hock and Professor Low Teck Seng served on the
Board for more than nine years from the date of their fi rst appointments, the NC rigorously reviewed their
past contributions to the Group and considered that they are independent in character and judgement and
there was no circumstance which would likely affect or appear to affect their judgements. Their lengths of
services and in-depth knowledge of the Group’s business are viewed by the Board as valuable during Board
deliberations.
The opinion was arrived at after careful assessment by the NC and the Board (save for Mr. Sunny Wong Fook
Choy, Mr. Kwah Thiam Hock and Professor Low Teck Seng). The rigorous reviews comprised reviews of, but
not limited to, the following factors: (a) the lengths of services of Mr. Sunny Wong Fook Choy, Mr. Kwah Thiam
Hock and Professor Low Teck Seng have not compromised the objectivities of Independent Directors and their
commitments and abilities to discharge their duties as Independent Directors; (b) the abilities of Independent
Directors to continue exercising independent judgement in the best interests of the Company, as they do
not have any relationship with the Company, its related corporations, substantial shareholders or its offi cers
which could materially impair their exercises of judgements; (c) the abilities of the Independent Directors to
express their objectives and independent views during Board and Board Committee meetings; and (d) the
Independent Directors, through their years of involvements with the Company, have gained valuable insights
and understandings of the Group’s business and together with their diverse experiences and expertise, have
contributed and will continue to contribute effectively as Independent Directors by providing impartial and
autonomous views at all times.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 23
REPORT ONCORPORATE GOVERNANCE
The Board also recognises the contributions of the Independent Directors who over time have developed
deep insights into the Group’s business and operations, and who are therefore able to provide invaluable
contributions to the Board as a whole. As such, the Board would exercise its discretion to extend the term and
retain the services of Mr. Sunny Wong Fook Choy, Mr. Kwah Thiam Hock and Professor Low Teck Seng rather
than lose the benefi t of their contributions.
The Company has a good balance of Directors with a wide range of skills, experience and qualities in the fi elds
of operations, management, fi nancial, legal and accounting. Each Director has been appointed on the strength
of his calibre, experience and stature and is expected to bring a valuable range of experience and expertise
to contribute to the development of the Group’s strategies and the performance of its business. Profi les of the
Directors are found on pages 12, 13 and 14 of this Annual Report.
To facilitate effective management, the Board has delegated specifi c responsibilities to three sub-committees,
namely:-
1) Audit Committee;
2) Nominating Committee; and
3) Remuneration Committee.
These committees comprise a majority of Independent Directors. The effectiveness of each committee is also
constantly monitored by the Board.
Where necessary, the Company encourages and co-ordinates informal meeting sessions for Independent
Directors to meet without the presence of the management.
Principle 3: ROLE OF CHAIRMAN AND GROUP CHIEF EXECUTIVE OFFICER (“CEO”)
The Chairman and Group CEO, Mr. Albert Phuay Yong Hen, plays an instrumental role in developing the
business of the Group and provides the Group with strong leadership and vision. He is responsible for the
day-to-day running of the Group as well as the exercise of control over the quality, quantity and timeliness of
information fl ow between the Board and Management. As the Chairman and Group CEO, he also determines
the Group’s strategies, ensures effective succession planning for all key positions within the Group, lead the
Board to ensure its effectiveness on all aspects of its role, ensure adequate time is available for discussion of
all agenda items including strategic issues, promote a culture of openness and debate at the Board, ensure
that Directors received complete, adequate and timely information, ensure effective communication with
shareholders, encourages constructive relations within the Board and between the Board and management
and ensures the Group’s compliance with the Code. The role of the Chairman is not separate from that of
the Group CEO as the Board considers that there is considerable accountability and transparency within the
Group.
The Independent Directors currently form half the composition of the Board and exercise objective judgement
on corporate matters impartially, thus ensuring a good balance of power and authority. As such, it would not be
necessary for the Group to effect a separation of the role of Chairman and Group CEO.
In view that the Chairman and Group CEO is the same person, the Board has appointed Mr. Kwah Thiam Hock
as the Lead Independent Director of the Board since 2014. Mr. Kwah works closely with other Independent
Directors and when necessary meets with them without the presence of other Directors to discuss matters
that were decided at Board meetings and provides feedback to the Chairman after such meetings. Mr. Kwah
will continue to avail himself to address shareholders’ concerns and act as a counter balance on management
issues in the decision making process.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201624
REPORT ONCORPORATE GOVERNANCE
Principle 4: BOARD MEMBERSHIP
Nominating Committee
The NC comprises the following Directors:-
Professor Low Teck Seng (Chairman)
Albert Phuay Yong Hen (Member)
Kwah Thiam Hock (Member)
Sunny Wong Fook Choy (Member)
The NC met twice in FY2016. The NC’s principal functions are to:-
4.1 Identify candidates and review all nominations for the appointment or re-appointment or re-election of
members of the Board of Directors and the members of the various Board Committees for the purpose
of proposing such nominations to the Board for its approval;
4.2 Determine the criteria for identifying candidates and reviewing nominations for the appointments referred
to in paragraph 4.1;
4.3 Review regularly the Board structure, size and composition having regard to the scope and nature of the
operations, the requirements of the business, the diversity of skills, experience, gender and knowledge of
the Company and the core competencies of the Directors as a Group;
4.4 Decide the manner in which the Board’s performance may be evaluated and propose objective
performance criteria for the Board’s approval;
4.5 Assess whether or not a Director is able to and has been adequately carrying out his duties as a
Director;
4.6 Assess the effectiveness of the Board as a whole, and the contribution by each individual Director to the
effectiveness of the Board;
4.7 Make and review plans for succession, in particular for the Chairman of the Board and Group CEO;
4.8 Determine on an annual basis the independence of Directors;
4.9 Review on a yearly basis the training programmes for the Board; and
4.10 Recommend and review training and professional development programmes for the Board to keep the
Board apprised of relevant new laws, regulations and changing commercial risks.
The NC had held a meeting in February 2017 for the nomination of Directors for the Sixteenth Annual General
Meeting (“AGM”).
The NC has reviewed the independence of each Director for FY2016 in accordance with the Code’s defi nition
of independence and is satisfi ed that half of the Board comprises Independent Directors. The NC is of the view
that Mr. Kwah Thiam Hock, Mr. Sunny Wong Fook Choy, Professor Low Teck Seng and Ms. Joanne Khoo Su
Nee are independent.
At present, new Directors are appointed by way of a Board resolution, upon the NC’s interview and approval
of their appointments. The new Directors must submit themselves for re-election at the next AGM of the
Company.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 25
REPORT ONCORPORATE GOVERNANCE
In accordance with Article 104 of the Company’s Constitution, all Directors shall retire from offi ce at least
once every three years and at each AGM, at least one-third of the Directors for the time being shall retire from
offi ce by rotation. In addition, Article 105 provides that retiring Directors shall be eligible to offer themselves for
re-elections.
In accordance with Article 108 of the Company’s Constitution, the Directors shall have power at any time and
from time to time to appoint any person to be a Director either to fi ll a casual vacancy or as an additional
Director and any Director so appointed shall hold offi ce only until the next AGM and shall then be eligible for re-
election but shall not be taken into account in determining the number of Directors who are to retire by rotation
at such Meeting.
The NC, in considering the re-election of a Director, evaluates such Director’s contribution and performance,
such as his attendance at meeting of the Board and/ or Board committees, participation, candour and any
special contribution.
Each member of the NC abstains from voting on any resolutions and making any recommendation and/ or
participating in respect of matters in which he is interested.
The NC is of the opinion that the independence of the Non-Executive Directors is maintained and that each
Director has contributed to the effectiveness of the Board as a whole. The Board has accepted the NC’s
nomination and has recommended the following Directors, who have given their consents for re-elections, to
be put forward for re-election at the forthcoming AGM:-
Sunny Wong Fook Choy (Retiring pursuant to Article 104)
Alan Kwan Wai Loen (Retiring pursuant to Article 104)
Herbert Kwok Fei Lung (Retiring pursuant to Article 108)
Tonny Phuay Yong Choon (Retiring pursuant to Article 108)
Joanne Khoo Su Nee (Retiring pursuant to Article 108)
When a Director has multiple board representations, the NC also considers whether or not the Director is
able to and has adequately carried out his duties as a Director of the Company, taking into consideration the
Director’s number of listed company Board representations and other principal commitments.
Although the Independent Directors and the Chairman and Group CEO hold directorships in other companies
which are not in the Group, the NC is of the view that there should be no restriction to the number of Board
representations of each Director and the Board is of the view that such multiple board representations do not
hinder them from carrying out their duties as Directors. These Directors would widen the experience of the
Board and give it a broader perspective.
The NC indentifi es, evaluates and selects suitable candidates for new directorships. The NC considers factors
such as the ability of the prospective candidates to contribute to discussions, the composition of the Board
including the mix of expertise, skills and attributes to the existing Directors so as to identify needed and/ or
desired competencies to supplement the Board’s existing attributes.
When the need for a new Director arises, or where it is considered that the Board would benefi t from the
services of a new Director with particular skills or to replace a retiring Director, the NC will be responsible
for nominating the new Director. The NC has put in place a process for the selection of new Directors and
re-election of incumbent Directors to increase transparency of the nominating process in identifying and
evaluating nominees. The NC leads the process and makes recommendations to the Board as follows:
(a) the NC will evaluate the skilled competencies of the candidates in areas such as technical, fi nancial
or legal expertise and experience in a similar or related industry, determine the selection criteria in
consultation with the Board, and select candidates with the appropriate expertise and experience for the
position, taking into account the value of gender diversity on the Board;
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201626
REPORT ONCORPORATE GOVERNANCE
(b) the NC will source for potential candidates if needed. Directors and the Management may also make
recommendations;
(c) the NC meets the shortlisted candidates to assess suitability and ensure that candidates are aware of
the expectation and the level of commitment required; and
(d) the NC then makes recommendations to the Board for approval.
The Company does not have any alternate Director.
The dates of initial appointment and last re-election of each Director, together with their directorships in other
listed companies are set out below:-
Name AppointmentDate of Initial Appointment
Date of Last Re-election
Current Directorships in Listed Companies
Past Directorships Held over
Preceding Three Financial Years
Albert Phuay Yong Hen Chairman and
Group CEO
18 May 2001 6 April 2016 None None
Alan Kwan Wai Loen Executive
Director
18 May 2001 8 April 2015 None None
David Kok Fat Keung(1) Executive
Director
5 July 2001 17 April 2014 None None
Herbert Kwok Fei Lung(2) Executive
Director
28 September
2016
N.A. None None
Tonny Phuay Yong Choon(2) Executive
Director
28 September
2016
N.A. None None
Kwah Thiam Hock Lead
Independent
Director
18 April 2007 6 April 2016 Wilmar International
Limited
Teho International Inc
Ltd
IFS Capital Ltd
None
Sunny Wong Fook Choy Independent
Director
13 November
2003
17 April 2014 China Medical
(International) Group
Limited
Mencast Holdings Ltd
KTL Global Limited
Civmec Limited
Innotek Limited
None
Professor Low Teck Seng Independent
Director
19 April 2006 8 April 2015 Singapore Post Limited
ISEC Healthcare Ltd
None
Joanne Khoo Su Nee(2) Independent
Director
28 September
2016
N.A. Kitchen Culture
Holdings Ltd.
Teho International Inc
Ltd
None
(1) Mr. David Kok has resigned as a Director of the Company with effect from 6 February 2016.
(2) Mr. Herbert Kwok, Mr. Tonny Phuay and Ms. Joanne Khoo were appointed as Directors of the Company with effect from
28 September 2016.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 27
REPORT ONCORPORATE GOVERNANCE
Principle 5: BOARD PERFORMANCE
The NC, in considering the re-appointment of any Director, evaluates the performance of the Director. The NC
and the Chairman of the Board implemented a self-assessment process that required each Director to assess
the performance of the Board as a whole for FY2016. The self-assessment process took into consideration,
inter alia, Board structure, corporate strategy and planning, risk management and internal control, performance
measurement and compensation, succession planning, financial reporting, conduct of meetings and
communication with shareholders.
Although the Board’s performance evaluation does not include a benchmark index of its industry peers, the
Board assesses its effectiveness holistically through the completion of a questionnaire by each individual
Director which includes questions covering the above-mentioned areas of assessment. The NC collates the
results of these questionnaires and formally discusses the results collectively with other Board members to
address any areas for improvement.
The NC has reviewed the overall performance of the Board in terms of its role and responsibilities and the
conduct of its affairs as a whole for the fi nancial year. It is of the view that the performance of the Board as a
whole has been satisfactory.
The NC will evaluate the performance of each Board Committee in FY2017.
In view of the size and composition of the Board, the Board deems it unnecessary for the NC to assess the
effectiveness of each Board Committee in FY2016.
The NC is of the view that the primary objective of the assessment exercise is to create a platform for the
Board members to exchange feedback on the strengths and shortcomings of the Board with a view to
strengthening its effectiveness. The assessment exercise also assists the Directors to focus on their key
responsibilities and helps the NC in determining whether to re-nominate Directors who are due for retirement at
the next AGM including determining whether Directors with multiple Board representatives are able to and have
adequately discharge their duties as Directors of the Company.
Principle 6: ACCESS TO INFORMATION
Prior to each Board meeting, the Board is supplied with relevant information such as quarterly management
reports, budgets, quarterly fi nancial statements, material events and transactions complete with background
and explanations by the management pertaining to matters to be brought before the Board for decision as well
as ongoing reports relating to operational and fi nancial performance of the Group. Such reports keep the Board
informed of the Group’s performance, fi nancial position and prospects, and consist of the consolidated fi nancial
statements, major operational updates, background or updates on matters before the Board for decision or
information, minutes of the previous Board meeting, and minutes of meetings of all committees of the Board
held since the previous Board meeting.
Detailed board papers are sent out to the Directors at least three working days before the scheduled meetings
so that the Directors may better understand the issues beforehand, allowing for more time at such meetings for
questions that Directors may have. However, sensitive matters may be tabled at the meeting itself or discussed
without any papers being distributed.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201628
REPORT ONCORPORATE GOVERNANCE
In addition, the Board has separate and independent access to senior management and the Company
Secretaries at all times. The appointment and removal of Company Secretaries are subject to the Board’s
approval as a whole.
Should Directors, whether individually or as a Group, need independent professional advice, the Company
Secretaries will, upon direction by the Board, appoint a professional advisor selected by the Group or
individual, and approved by the Chairman to render advice. The cost of such professional advice will be borne
by the Company.
At least one of the Company Secretaries attends all Board meetings and Committee meetings and is
responsible to assist the Board to ensure that proper procedure and all other rules and regulations applicable
to the Company are complied with. The Company Secretaries prepare minutes of meetings of the Board and
Board Committees and assist the Board in ensuring that the Company complies with the relevant requirements
of the Companies Act, Securities and Futures Act and the Listing Manual of the SGX-ST. They also advise the
Board on corporate governance matters.
REMUNERATION MATTERS
Principle 7: PROCEDURES FOR DEVELOPING REMUNERATION POLICIESPrinciple 8: LEVEL AND MIX OF REMUNERATIONPrinciple 9: DISCLOSURE ON REMUNERATION
Remuneration Committee
The RC comprises the following three Directors, of whom all are Independent Directors:-
Sunny Wong Fook Choy (Chairman)
Kwah Thiam Hock (Member)
Professor Low Teck Seng (Member)
The RC met twice in FY2016. Its principal responsibilities are to:-
7.1 Recommend to the Board base pay levels, benefi ts and incentive opportunities, and identify components
of pay which can best be used to focus management staff on achieving corporate objectives, including
identifying equity-based incentives such as stock options;
7.2 Recommend to the Board the structure of the compensation program for Directors and senior
management to ensure that the program is competitive and suffi cient to attract, retain and motivate
senior management of the required quality to run the Company successfully; and
7.3 Review compensation packages of Directors, senior management and employees who are related to the
Executive Directors and Controlling Shareholders (including the compensation package of the Chairman
and Group CEO) annually and determine appropriate adjustments for approval by the Board.
Each member of the RC refrains from voting on any resolutions in respect of the assessment of his
remuneration. No RC member is involved in determining his own remuneration.
Independent Directors do not have service agreements with the Company. The Independent Directors receive
Directors’ fees and shares which are recommended by the Board for approval at the Company’s AGM.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 29
REPORT ONCORPORATE GOVERNANCE
The Executive Directors do not receive Directors’ fees and are paid based on their Service Agreements with
the Company as disclosed in the Company’s Prospectus dated 18 December 2003. The Agreements were
renewed for a further period of three years from 1 January 2017. In setting the remuneration packages of the
Executive Directors, the Company takes into account the performance of the Group and that of the Executive
Directors which are aligned with long term interests of the Group.
Key Management Personnel’s remuneration is set in accordance with a remuneration framework comprising
salary, variable bonus, shares and benefi ts-in-kind. In view of the competitive pressures in the labour market on
retaining talent, the Company believes that it is not in the best interests of the Company to disclose the names
of the top fi ve Key Management Personnel.
The RC can, upon direction by the Board, engage any external professional advice on matters relating to
remuneration as and when the need arises.
For competitive reasons, the Company will not fully disclose details of Directors’ remuneration within bands of
S$250,000.
The Company believes that the full disclosure of remuneration including the upper limit for the highest
remuneration band of its Executive Directors and top fi ve Key Management Personnel as recommended by the
Code would be prejudicial to the Company’s interests and hamper its ability to retain and nurture the Group’s
talent pool. The Company has instead disclosed the breakdown in percentage terms of the individual Executive
Director’s remuneration within appropriate bands whilst the remuneration of the top fi ve Key Management
Personnel (who are not Directors of the Company) are presented only in a baseline remuneration band.
The remuneration in FY2016 of the Directors and Key Management Personnel are set out below:-
Directors’ and Group CEO’s Remuneration
Remuneration Bands Name of DirectorDirectors’
Fees%
Salary%
Bonus%
Allowance & Benefi ts
%
Share Based
%Total
%
S$500,000 and above Albert Phuay Yong Hen – 85% 14% 1% – 100%
S$500,000 and above Alan Kwan Wai Loen – 83% 14% 3% – 100%
S$500,000 and above David Kok Fat Keung(1) – 86% 14% – – 100%
Below S$250,000 Herbert Kwok Fei Lung(2)(3) – 91% 6% 3% – 100%
Below S$250,000 Tonny Phuay Yong Choon(2)(3) – 86% 5% 9% – 100%
Below S$250,000 Kwah Thiam Hock 92% – – – 8% 100%
Below S$250,000 Professor Low Teck Seng 92% – – – 8% 100%
Below S$250,000 Sunny Wong Fook Choy 92% – – – 8% 100%
Below S$250,000 Joanne Khoo Su Nee(2)(3) 100% – – – – 100%
(1) Mr. David Kok has resigned as a Director of the Company with effect from 6 February 2016.
(2) Mr. Herbert Kwok, Mr. Tonny Phuay and Ms. Joanne Khoo were appointed as Directors of the Company with effect from
28 September 2016.
(3) Subject for Shareholders’ approval at the 2017 AGM.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201630
REPORT ONCORPORATE GOVERNANCE
Remuneration of Top 5 Key Management Personnel (who are not Directors or CEO)
No. of Key Management Personnel Salary*%
Bonus*%
Allowance & Benefi ts*
%
Share Based*
%Total*
%
S$250,000 to below S$500,000
1 91% 6% 3% – 100%
1 86% 5% 9% – 100%
1 91% 6% 3% – 100%
1 93% 3% 4% – 100%
1 91% – 9% – 100%
* Mr. Tonny Phuay and Mr. Herbert Kwok were Key Management Personnel during the period of 1 January 2016 to 27 September 2016,
hence their pro-rated salaries within this period.
The annual aggregate amount of the total remuneration paid to top fi ve Key Management Personnel (who are
not Directors or Chairman and Group CEO) is approximately S$1,751,000.
The Company does not use contractual provisions to allow the Group to reclaim incentive components of
remuneration from the Executive Directors and Key Management Personnel in exceptional circumstances of
misstatement of fi nancial results, or of misconduct resulting in fi nancial loss to the Company. The Executive
Directors owe a fi duciary duty to the Company. The Company should be able to avail itself to remedies against
the Executive Directors in the event of such breach of fi duciary duties.
There are four (4) employees who are immediate family members of our Directors and whose remuneration
exceeds S$50,000 for FY2016. Of which, Mr. Phuay Yong Hua is part of the top fi ve Key Management
Personnel as listed above, and Mr. Tonny Phuay was appointed as an Executive Director on 28 September
2016. By the same token, their remunerations in incremental bands of S$50,000 will not be disclosed.
Name of Employees Related To
Below S$750,000
Tonny Phuay Yong Choon Brother to Mr. Albert Phuay Yong Hen (Chairman and Group CEO)
Below S$500,000
Phuay Yong Hua Brother to Mr. Albert Phuay Yong Hen (Chairman and Group CEO)
Chan Yuk Wah Ivy Spouse of Mr. Herbert Kwok Fei Lung (Executive Director)
Below S$250,000
Phuay Li Ying Daughter of Mr. Albert Phuay Yong Hen (Chairman and Group CEO)
There are no termination, retirement and post-employment benefi ts granted to Directors, the Chairman and
Group CEO or the top fi ve Key Management Personnel in FY2016.
Excelpoint Performance Share Scheme
The Company has adopted the Excelpoint Performance Share Scheme (the “EPSS”) to increase the
Company’s fl exibility and effectiveness in its continual efforts to reward, retain and motivate employees to
achieve superior performance, which was approved by the shareholders at the Extraordinary General Meeting
held on 25 June 2008.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 31
REPORT ONCORPORATE GOVERNANCE
The EPSS Committee members consist of Mr. Albert Phuay Yong Hen, Mr. Kwah Thiam Hock, Mr. Sunny
Wong Fook Choy and Professor Low Teck Seng.
On 15 February 2016, 60,000 new ordinary shares had been granted and vested to three Independent
Directors and thereafter, on 18 November 2016, 327,500 new ordinary shares had been granted and vested
to employees pursuant to the EPSS respectively and the relevant SGXNet announcements had been released
accordingly.
Since the commencement of the EPSS, no shares have been granted to any controlling shareholders and their
associates pursuant to the vesting of the Awards under the EPSS during FY2016. No employee in the Group
has received shares which, in aggregate, represent 5% or more of the aggregate of the total number of shares
available under the EPSS during FY2016.
Excelpoint Share Option Scheme 2014
The Company has adopted the Excelpoint Share Option Scheme 2014 (the “ESOS”), which is primarily a share
incentive scheme, to complement the existing EPSS to provide the Company with greater fl exibility in tailoring
reward and incentive packages suitable for Participants, which was approved by the shareholders at the
Extraordinary General Meeting held on 17 April 2014.
The ESOS Committee members consist of Mr. Albert Phuay Yong Hen, Mr. Kwah Thiam Hock, Mr. Sunny
Wong Fook Choy and Professor Low Teck Seng.
Since commencement of the ESOS and during the fi nancial year under review, no options or incentive options
have been granted under the ESOS to the Participants in the Group including the Company’s controlling
shareholders and its associates, Directors and employees of the parent company and its subsidiaries and
Executive Directors and employees of the Company’s associated companies.
Accordingly, no participant has received 5% or more of the total number of options or incentive options
available under the ESOS.
The Board is of the opinion that the information as disclosed above would be suffi cient for shareholders to have
an adequate appreciation of the Group’s compensation policies and practices and therefore does not intend to
issue a separate remuneration report, the contents of which would be largely similar.
ACCOUNTABILITY
Principle 10: ACCOUNTABILITY
The Board seeks to continue providing shareholders with a comprehensive view of the Company’s fi nancial
performance, position and prospects on a quarterly basis.
The Management currently provides the Board with appropriately detailed management accounts of the
Group’s performance, position and prospects on a quarterly basis.
The Board provides the shareholders with a detailed and balanced explanation and analysis of the
Company’s performance, position and prospects on a quarterly basis. This responsibility extends to report to
regulators. Financial reports and other price-sensitive information are disseminated to shareholders through
announcements via SGXNet, press releases and the Company’s website. The Board will review and approve
the fi nancial reports before their release. The Board will also review and approve any press releases concerning
the Company’s fi nancial results. The Company’s Annual Report is available on request and accessible on the
Company’s website.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201632
REPORT ONCORPORATE GOVERNANCE
The Company will continue to update shareholders on the operations and fi nancial position of the Company
through quarterly and full year announcements as well as timely announcements of other matters as prescribed
by the relevant rules and regulations.
Principle 11: RISK MANAGEMENT AND INTERNAL CONTROLS
The Company has an Enterprise Risk Management Framework (“Framework”) in place for the Group. The said
Framework has been reviewed by the AC and approved by the Board. The AC and the Board will continually
assess the adequacy and effectiveness of the risk management framework and processes.
The Board is responsible for the overall internal control framework and is fully aware of the need to put in place
a system of internal controls within the Group to safeguard the interests of the shareholders and the Group’s
assets.
The Board recognises that no cost effective internal control system will preclude all errors and irregularities, as
a system is designed to manage rather than eliminate the risk of failure to achieve business objectives, and can
provide only reasonable and not absolute assurance against material misstatement or loss.
The Company’s internal and external auditors conduct annual review of the adequacy and effectiveness of
the Company’s material internal control systems including fi nancial, operational, compliance and information
technology controls and risk assessment and test annually to ensure the adequacy thereof.
As part of the annual statutory audit on fi nancial statements, the external auditors report to the AC and the
appropriate level of management any material weaknesses in fi nancial controls over the areas which are
signifi cant to the audit. The AC also reviews the effectiveness of the actions taken by the management on the
recommendations made by the internal and external auditors in this respect.
The Board has received assurance from the Chairman and Group CEO, the Group Chief Financial Offi cer
(“CFO”) as well as the internal auditor that the fi nancial records of the Group have been properly maintained
and the fi nancial statements for FY2016 give a true and fair view of the Group’s operations and fi nances; and
the Group has put in place and will continue to maintain a reasonably adequate and effective system of risk
management and internal controls.
The Board of Directors and the AC have reviewed the adequacy and effectiveness of the Group’s internal
controls that address the Group’s fi nancial, operational and compliance risks. Based on the internal controls
established and maintained by the Group, work performed by the internal and external auditors, and reviews
performed by management, various Board Committees and the Board, the Board with the concurrence of
the AC are of the opinion that the Group’s internal controls, including fi nancial, operational, compliance and
information technology and risk management systems, were adequate and effective as at 31 December 2016.
Principle 12: AUDIT COMMITTEE
The AC comprises the following four Directors, all of whom are Independent Directors:-
Kwah Thiam Hock (Chairman)
Sunny Wong Fook Choy (Member)
Professor Low Teck Seng (Member)
Joanne Khoo Su Nee(1) (Member)
(1) Ms. Joanne Khoo was appointed as Member with effect from 28 September 2016.
All the members of the AC have had many years of experience in senior management positions in different
sectors. The Board is of the view that the members of the AC have suffi cient fi nancial management expertise
and experience to discharge their responsibilities as members of the AC.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 33
REPORT ONCORPORATE GOVERNANCE
The AC meets quarterly to perform the following key functions:-
12.1 Recommend to the Board of Directors, the external and internal auditors to be nominated, approve the
remuneration of the external auditors, and review the scope and results of the audit;
12.2 Review all non-audit services provided by the external auditors so as to ensure that any provision of
such services would not affect the independence of the external auditors;
12.3 Review (with the other committees, management, and the external and internal auditors) signifi cant
risks or exposures that exist and assess the steps management has taken to minimise such risk to the
Company;
12.4 Review interested person transaction;
12.5 Review with the Group CFO and external auditors at the completion of the annual examination:-
The external auditors’ audit of the annual fi nancial statements and reports;
The adequacy of the Group’s system of accounting controls;
The level of assistance and co-operation given by management to external auditors;
Any signifi cant fi ndings and recommendations of the external auditors and internal auditors and
the related management’s responses thereto; and
Any signifi cant changes required in the external auditors’ audit plan, any serious diffi culties or
disputes with management encountered during the course of the audit and their resolution, and
other matters related to the conduct of the audit.
12.6 Review legal and regulatory matters that may have a material impact on the fi nancial statements’ related
exchange compliance policies, programs and reports received from regulators;
12.7 Report actions and resolutions of the AC to the Board of Directors with such recommendations as the
AC considers appropriate; and
12.8 Review the adequacy and effectiveness of the Company’s risk management and internal control systems
(including fi nancial, operational, compliance and information technology controls) and to report to the
Board annually.
The AC has express power to conduct or authorise investigations into any matters within its terms of reference.
Minutes of AC meetings are regularly submitted to the Board for its information and review.
Pursuant to Listing Rule 716, the Board and the AC are satisfi ed that the appointment of different auditors for
its signifi cant subsidiaries would not compromise the standard and effectiveness of the audit of the Company.
In appointing the auditing fi rms for the Company, subsidiaries and signifi cant associated companies, the
Company has complied with Listing Rules 712 and 715.
The AC has conducted an annual review of the volume of non-audit services to satisfy itself that the nature and
extent of such services will not prejudice the independence and objectivity of the auditors before confi rming
their re-nomination. The audit service and non-audit service fees paid or payable to the external auditors
of the Company for the fi nancial year ended 31 December 2016 amounts to US$210,000 and US$17,000
respectively.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201634
REPORT ONCORPORATE GOVERNANCE
The AC also meets with the external auditors, without the presence of management, at least once a year.
For FY2016, the AC met once with the external auditors without presence of the management. This meeting
enables the external auditors to raise issues encountered in the course of their work directly to the AC.
The AC has full access to and co-operation of the management and external and internal auditors including
full discretion to invite any Director or Key Management Personnel to attend the meetings, and has been given
reasonable resources to enable it to discharge its functions and duties.
The accounts for the year were audited by Ernst & Young LLP and the AC has recommended to the Board that
Ernst & Young LLP be nominated for re-appointment as Auditors at the forthcoming AGM.
The Company has in place a whistle-blowing framework, which provides an avenue for the staff of the
Company to raise concerns about improprieties and the independent investigation of such matters by the AC.
A whistle-blower email address is created for reporting suspected fraud, corruption, dishonest practices or
other similar matters. Details of the whistle-blowing policies and arrangements have been made available to all
employees of the Company.
The AC shall commission and review the fi ndings of internal investigations where there is any suspected fraud
or irregularity, or failure of internal controls or infringement of any law, rule or regulation which has or is likely
to have a material impact on the Group’s operating results and/ or fi nancial position. There was no whistle-
blowing letter received during the year.
The external auditors present to the AC the audit plan and updates relating to any change of accounting
standards which have a direct impact on the fi nancial statements before an audit commences. During the
fi nancial year ended 31 December 2016, the changes in accounting standards did not have any signifi cant
impact on the Company’s fi nancial statements.
No former partner or Director of the Company’s existing auditing fi rm or auditing corporation is a member of
the AC.
Principle 13: INTERNAL AUDIT
The Company has outsourced the internal audit function to Messrs Baker Tilly Consultancy (Singapore)
Pte Ltd. The internal audit function is to review key business processes of the Company and its material
subsidiaries with the primary objective of identifying signifi cant control issues that the AC and management
should focus their attention on.
The AC is satisfi ed that the internal audit is staffed by suitably qualifi ed and experienced personnel.
In the discharge of its functions, the internal auditors report directly to the Chairman of the AC on functional
matters and to the Group CFO on administrative matters. The AC reviews and approves the internal audit plans
annually and ensures that resources are adequate to perform the function effectively.
On an annual basis, the internal auditor will conduct a review of the risks identifi ed by the external risk
consultants. Any material non-compliance or lapses in internal controls, together with recommendations for
improvement are reported to the AC. A copy of the report is also issued to the relevant department for its
follow-up action. The timely and proper implementation of all required corrective, preventive or improvement
measures are closely monitored. In addition, major control weaknesses on fi nancial reporting, if any, are
highlighted by the external auditor in the course of their statutory audit.
The AC meets with the internal auditors, without the presence of management, at least once a year. For
FY2016, the AC met once with the internal auditors without the presence of the management.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 35
REPORT ONCORPORATE GOVERNANCE
COMMUNICATION WITH SHAREHOLDERS
Principle 14: SHAREHOLDERS RIGHTSPrinciple 15: COMMUNICATION WITH SHAREHOLDERSPrinciple 16: GREATER SHAREHOLDER PARTICIPATION
The Company does not practise selective disclosure of material information. Material and price-sensitive
information is always released on SGXNet after trading hours. Results and annual reports are announced or
issued within the mandatory periods and are available on the Company website. When press conferences
and briefi ngs will be held on major events and fi nancial results, the management will only meet the press and
analysts after the announcement is released on SGXNet.
All shareholders of the Company receive the annual report and Notice of AGM. The Notice is also advertised in
a national newspaper. At AGMs, shareholders are given the opportunity to air their views and ask Directors or
management questions regarding the Company. Separate resolutions on each distinct issue are proposed at
general meetings for approval. The external auditors and legal advisors (if necessary) are present to assist the
Directors in addressing any queries by shareholders.
The Constitution allows a member of the Company to appoint one or two proxies to attend and vote in place
of the member. A shareholder who is unable to attend the general meetings is entitled to appoint up to two
proxies, unless the shareholder is a relevant intermediary (as defi ned in Section 181 of the Companies Act,
Chapter 50). A relevant intermediary is entitled to appoint more than two proxies, but each proxy must be
appointed to exercise the rights attached to a different share or shares held by such shareholder.
The Board notes that there should be separate resolutions at general meetings on each substantially separate
issue and supports the Code’s principle regarding “bundling” of resolutions.
The participation of shareholders is encouraged at the AGM through open question and answer session.
The Chairman of the Audit, Remuneration and Nominating Committees are available at the AGM to address
any queries or concerns and the external auditors are also available to assist the Directors in addressing any
relevant queries from the shareholders.
For greater transparency and fairness in the voting process, voting for all resolutions passed at shareholders’
meetings were conducted by poll since 2015 and the voting results of the general meetings, including the total
numbers of votes cast for or against each resolution, are released via SGXNet on the same day. However, as
the authentication of shareholder identity and other related security and integrity of the information still remain
a concern, the Company has decided, for the time being, not to implement voting in absentia by mail, email or
fax.
The Company will review its Constitution from time to time and make amendments to the Constitution to be in
line with the applicable requirements or rules and regulations governing the continuing obligations.
The Company does not have any dividend policy. However, depending upon the Group’s operating results,
fi nancial conditions, other cash requirements including capital expenditure, terms of borrowing arrangements
and other factors deemed relevant by the Directors, the Company does consider positively the payment of
annual dividend. Any dividend payments are clearly communicated to shareholders via announcements on
SGXNet.
The Company prepares minutes of general meetings that include substantial and relevant comments or queries
from shareholders relating to the agenda of the meeting and responses from the Board and management.
These are available to shareholders upon their request.
The Company has a dedicated Investor Relations (“IR”) team which regularly communicates with shareholders,
analysts or investors through e-mail communication and telephone to update them on the latest corporate
development and at the same time address their queries.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201636
REPORT ONCORPORATE GOVERNANCE
DEALINGS IN SECURITIES
The Company has adopted an Internal Compliance Code on Securities Transactions (“Internal Compliance
Code”) to Directors and key employees (including employees with access to price-sensitive information to the
Company’s shares) of the Group setting out the code of conduct on transactions in the Company’s shares by
these persons in compliance with the Rule 1207(19) of the Listing Manual of the SGX-ST.
The Group issues quarterly reminders to its Directors, offi cers and employees on the restrictions in dealings in
listed securities of the Group. The Company and its Directors and offi cers are advised and informed via email
that they are not allowed to deal in the Company’s shares during the period commencing two weeks before the
announcement of the Company’s fi nancial results for each of the fi rst three quarters of its fi nancial year, or one
month before the announcement of the Company’s full year fi nancial results and ending one trading day after
the announcement of the relevant results or when they are in possession of any unpublished price-sensitive
information of the Group.
In compliance with Rule 1207(19)(b), the Internal Compliance Code forbids its offi cers from dealing in the
Company’s securities on short-term considerations.
In accordance with the guidelines on share purchase under the share buyback mandate, renewed annually at
the Company’s AGM, the Company will not undertake any purchase or acquisition of shares pursuant to the
proposed share buyback mandate at any time after a price-sensitive development has occurred or has been
the subject of a decision until the price-sensitive information has been publicly announced. In particular, in
line with the Internal Compliance Code, the Company will not purchase or acquire any shares during the two
weeks before the announcement of the Company’s fi nancial statements for each of the fi rst three quarters of its
fi nancial year and one month before the release of the Company’s full year fi nancial statements and ending one
trading day after the announcement of the relevant results.
MATERIAL CONTRACTS
Pursuant to Rule 1207(8) of the SGX-ST Listing Manual, the Company confi rms that except as disclosed in the
“Interested Person Transactions” below, there were no material contracts entered into by the Company or its
subsidiaries involving the interest of any Director or Chairman and Group CEO or controlling shareholders for
the fi nancial year ended 31 December 2016.
INTERESTED PERSON TRANSACTIONS
The aggregate value of all interested person transactions during the fi nancial year ended 31 December 2016
were as follows:-
Name of Interested Person
Aggregate value of all interested person
transactions during the fi nancial year under
review (excluding transactions less
than S$100,000 and transactions conducted
under shareholders’ mandate pursuant to
Rule 920)
Description of the transaction entered
into with the interested person during the
fi nancial year under review
Aggregate value of all interested person
transactions conducted during the fi nancial year
under shareholders’ mandate pursuant to Rule 920 (excluding
transactions less than S$100,000)
Albert Phuay Yong Hen US$109,200 Rental of offi ce premises N.A.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 37
REPORT ONCORPORATE GOVERNANCE
USE OF PLACEMENT PROCEEDS
The Company refers to the net proceeds of approximately S$7,825,000 raised from the placement of 15 million
new ordinary shares at S$0.525 each in the issued and paid-up share capital of the Company on 5 October
2016 (the “Net Proceeds”) (as defi ned in the Company’s announcement dated 2 September 2016).
As at the date of this Report, there has not been any utilisation of the Net Proceeds and the Net Proceeds are
deposited with a bank pending deployment. The Company will make periodic announcements on the utilisation
of the Net Proceeds as and when the funds are materially disbursed and whether such use is in accordance
with the stated use and in accordance with the percentage allocated.
On Behalf of the Directors,
Albert Phuay Yong Hen
Chairman and Group CEO
Singapore
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201638
REPORT OFTHE AUDIT COMMITTEE
Financial Matters
For FY2016, the AC held four (4) meetings. During each of these meetings, the AC reviewed the quarterly
fi nancial accounts prepared by management, including all supporting schedules such as the Group’s Trade
Debtors Aging, Group’s movement in allowance and write back of doubtful debts, review of customers with
signifi cant credit exposure. The AC also reviews the movements in stocks in relation to the stock provisioning
policy. Other matters reviewed include: the Group’s operating expenses, the top 5 product lines and top 5
customers as well as the availability and utilization of Group’s banking lines.
Market Risks
The Group’s business is subject to the risks of market price erosion and stock obsolescence mainly due to the
volatile nature of the global electronic industry. Hence, it is important for AC to ensure that the Group does not
carry excessive stocks and wherever possible stocks are only purchased when there are fi rmed orders on hand
or are adequately backed by stock rotation and price protection arrangements with major suppliers.
Oversight of the external auditor
The AC approved the scope and audit plan presented by the auditor. It also reviewed the results of the audit,
including signifi cant fi ndings and recommendations as well as management’s responses.
AC held a separate meeting with the auditors without the presence of management during which the
AC was briefed on the Audit Quality Indicators achieved by the auditors. AC is satisfi ed with the auditor’s
independence and that it has maintained a high standard of audit quality and controlled policies. AC therefore
recommends to the Board the re-appointment of the auditor at the coming AGM.
Key Audit Matters
In respect of the Key Audit Matters highlighted by the auditors, AC’s comments are as follows:
Signifi cant matters AC’s comments
(1) Revenue Recognition AC concurred with management’s methodology of revenue recognition which
occurs only upon the transfer of signifi cant risk and rewards of ownership of
the goods to the customer, usually on delivery of goods.
(2) Recovery of Trade
Receivables
At each AC meeting, the committee reviewed all slow paying debts to
ascertain they are indeed collectable. The auditor has highlighted one
particular account in China where the goods delivered was accidentally
damaged by other suppliers involved in the project. AC is satisfi ed that there
was no dispute on the quality and the customer has assured payments when
the damaged parts are replaced.
Overall, the AC is satisfi ed that management does monitor closely the aging of
debtors and concurred with the auditor on the write off of doubtful debt.
(3) Provision for
slow-moving and
obsolete stocks
AC briefed the auditor on the recent changes in provisioning policy so as to
minimize the writing off and writing back of slow-moving stocks. AC noted
that major suppliers have provided the Group with price protection or stock
rotation. Hence, the risks of stock obsolescence are well controlled.
On behalf of the Audit Committee,
Kwah Thiam HockChairman of the Audit Committee
Singapore
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 39
DIRECTORS’ STATEMENT
The directors are pleased to present their statement to the members together with the audited consolidated
fi nancial statements of Excelpoint Technology Ltd (the “Company”) and its subsidiaries (collectively, the “Group”)
and the balance sheet and statement of changes in equity of the Company for the fi nancial year ended 31
December 2016.
1. Opinion of the Directors
In the opinion of the directors,
(i) the consolidated fi nancial statements of the Group and the balance sheet and statement
of changes in equity of the Company are drawn up so as to give a true and fair view of the
fi nancial position of the Group and of the Company as at 31 December 2016 and the fi nancial
performance, changes in equity and cash fl ows of the Group and changes in equity of the
Company for the year ended on that date; and
(ii) at the date of this statement, there are reasonable grounds to believe that the Company will be
able to pay its debts as and when they fall due.
2. Directors
The directors of the Company in offi ce at the date of this statement are:-
Albert Phuay Yong Hen (Chairman and Group Chief Executive Offi cer)
Alan Kwan Wai Loen
Herbert Kwok Fei Lung (Appointed on 28 September 2016)
Tonny Phuay Yong Choon (Appointed on 28 September 2016)
Kwah Thiam Hock
Sunny Wong Fook Choy
Professor Low Teck Seng
Joanne Khoo Su Nee (Appointed on 28 September 2016)
3. Arrangements to enable directors to acquire shares and debentures
Except as described in paragraph 6 below, neither at the end of nor at any time during the fi nancial year
was the Company a party to any arrangement whose objects are, or one of whose objects is, to enable
the directors of the Company to acquire benefi ts by means of the acquisition of shares or debentures of
the Company or any other body corporate.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201640
DIRECTORS’ STATEMENT
4. Directors’ interests in shares and debentures
The following directors, who held offi ce at the end of the fi nancial year, had, according to the register
of directors’ shareholdings required to be kept under Section 164 of the Singapore Companies Act,
Chapter 50, an interest in shares of the Company as stated below:-
Direct interest Deemed interest
Name of director
At the beginning of fi nancial year or the date of appointment
At the endof fi nancial
year
At the beginning of fi nancial yearor the date of appointment
At the endof fi nancial
year
Ordinary shares of the CompanyAlbert Phuay Yong Hen 47,901,504 47,915,204 2,598,168 2,598,168
Alan Kwan Wai Loen 6,258,244 6,258,244 – –
Herbert Kwok Fei Lung 343,600 343,600 201,200 229,300
Tonny Phuay Yong Choon 144,800 144,800 – –
Kwah Thiam Hock 20,000 40,000 – –
Sunny Wong Fook Choy 40,000 60,000 – –
Professor Low Teck Seng 20,000 40,000 – –
By virtue of Section 7 of the Singapore Companies Act, Chapter 50, Albert Phuay Yong Hen is deemed
to have interests in shares of the subsidiaries of the Company, all of which are wholly-owned by the
Company.
There was no change in any of the above-mentioned interests in the Company between the end of the
fi nancial year and 21 January 2017.
Except as disclosed in this report, no director who held offi ce at the end of the fi nancial year had
interests in shares, share options, warrants or debentures of the Company, or of related corporations,
either at the beginning of the fi nancial year, or at the end of the fi nancial year.
5. Directors’ contractual benefi ts
Except as disclosed in the fi nancial statements, since the end of the previous fi nancial year, no director
of the Company has received or become entitled to receive a benefi t by reason of a contract made by
the Company or a related corporation with the director, or with a fi rm of which the director is a member,
or with a Company in which the director has a substantial fi nancial interest.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 41
DIRECTORS’ STATEMENT
6. Share plans
Options
At an Extraordinary General Meeting held on 17 April 2014, shareholders approved the Excelpoint Share
Option Scheme (the “ESOS”) for the granting of non-transferable options that are settled by physical
delivery of the ordinary shares of the Company, to eligible directors and group employees.
The ESOS is administered by Albert Phuay Yong Hen, Sunny Wong Fook Choy, Professor Low Teck
Seng and Kwah Thiam Hock.
As at the date of this report and since the commencement of the ESOS until the end of the fi nancial
year, no options have been granted under the ESOS.
Eligibility
Subject to the absolute discretion of the Committee, the following persons shall be eligible to participate
in the ESOS:
(a) Confi rmed Employees or Associated Company Employees; and
(b) Non-Executive Directors,
who have attained the age of twenty-one (21) years on or before the date of grant and are not
undischarged bankrupts and who have not entered into a composition with his or her creditors.
Persons who are Controlling Shareholders or their Associates are not eligible to participate in the ESOS.
Performance shares
The Company has adopted the Excelpoint Performance Share Scheme (“EPSS” or “Award”), which was
approved by the shareholders at the Extraordinary General Meeting held on 25 June 2008.
EPSS is administered by Albert Phuay Yong Hen, Kwah Thiam Hock, Sunny Wong Fook Choy and
Professor Low Teck Seng.
Eligibility
The following persons (provided that such persons are not undischarged bankrupts at the relevant time)
shall be eligible to participate in the Scheme at the absolute discretion of the Committee:
(a) Group Employees (including Group Executive Directors) who have attained the age of 21 years on
or before the date of grant of the Award; and
(b) Non-Executive Directors who have attained the age of 21 years on or before the date of grant of
the Award.
Controlling Shareholders and their Associates shall be eligible to participate in the Scheme. However, the
aggregate number of shares available to Controlling Shareholders and their Associates must not exceed
25% of the shares available under the Scheme. The number of shares available to each Controlling
Shareholder or his Associate must also not exceed 10% of the shares available under the Scheme.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201642
DIRECTORS’ STATEMENT
6. Share plans (cont’d)
Performance shares (cont’d)
Eligibility (cont’d)
During the fi nancial year, the Company has granted 387,500 shares (2015: 897,400 shares) to its directors and employees.
(1) (2) (3) (4)=(1)-(3) (5)
Name of Participant
Number of shares
comprised in Awards to be issued during fi nancial year under review
(including terms)
Aggregate number
of shares comprised in Awards from
commencement of Scheme
to the end of fi nancial year under review
Number of shares
comprised in Awards
allotted and/or transferred
during the fi nancial year under review
Number of shares
comprised in Awards not
released during fi nancial year under review
Proportion of shares
comprised in Awards vested
during fi nancial year under review
Directors of the Company
Kwah Thiam Hock 20,000 * 40,000 20,000 – 20,000
Professor Low Teck Seng 20,000 * 40,000 20,000 – 20,000
Sunny Wong Fook Choy 20,000 * 40,000 20,000 – 20,000
* The Awards were granted on 15 February 2016 made pursuant to a resolution passed at the Annual General Meeting of
the Company held on 8 April 2015 wherein an aggregate number of 60,000 ordinary shares in the capital of the Company
would be granted to the Independent Directors of the Company under EPSS as part of their respective remuneration for the
fi nancial year from 1 January 2015 to 31 December 2015.
Since the commencement of the EPSS until the end of the fi nancial year:
• No Awards have been granted to the controlling shareholders of the Company and their associate; and
• No participant has received 5% or more of the total awards available under the EPSS.
7. Audit Committee
The AC carried out its functions in accordance with Section 201B (5) of the Singapore Companies Act, Chapter 50, including the following:-
• Reviewed the audit plans of the internal and external auditors of the Group and the Company, and reviewed the internal auditor's evaluation of the adequacy of the Company's system of internal accounting controls and the assistance given by the Group’s and the Company's management to the internal and external auditors;
• Reviewed the quarterly and annual fi nancial statements and the auditor’s report on the annual fi nancial statements of the Group and the Company before their submission to the Board of Directors;
• Reviewed effectiveness of the Group’s and the Company's material internal controls, including fi nancial, operational and compliance controls and risk management via reviews carried out by the internal auditor;
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 43
DIRECTORS’ STATEMENT
7. Audit Committee (cont’d)
• Met with the external auditor, other committees, and management in separate executive sessions
to discuss any matters that these groups believe should be discussed privately with the AC;
• Reviewed legal and regulatory matters that may have a material impact on the financial
statements, related compliance policies and programmes and any reports received from
regulators;
• Reviewed the cost effectiveness and the independence and objectivity of the external auditor;
• Reviewed the nature and extent of non-audit services provided by the external auditor;
• Recommended to the Board of Directors the external auditor to be nominated, approved the
compensation of the external auditor, and reviewed the scope and results of the audit;
• Reported actions and minutes of the AC to the Board of Directors with such recommendations as
the AC considered appropriate; and
• Reviewed interested person transactions in accordance with the requirements of the Singapore
Exchange Securities Trading Limited's Listing Manual.
The AC, having reviewed all non-audit services provided by the external auditor to the Group, is satisfi ed
that the nature and extent of such services would not affect the independence of the external auditor.
The AC has also conducted a review of interested person transactions.
The AC convened four meetings during the year with full attendance from all members. The AC has also
met with internal and external auditors, without the presence of the Company's management, at least
once a year.
Further details regarding the AC are disclosed in the Report on Corporate Governance.
8. Auditor
Ernst & Young LLP have expressed their willingness to accept re-appointment as auditor.
On behalf of the Board of Directors,
Albert Phuay Yong Hen
Director
Alan Kwan Wai Loen
Director
Singapore
28 February 2017
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201644
Independent Auditor’s ReportTo the Members of Excelpoint Technology Ltd
For the fi nancial year ended 31 December 2016
Report on the fi nancial statements
We have audited the fi nancial statements of Excelpoint Technology Ltd (the “Company”) and its subsidiaries
(collectively, the “Group”) set out on pages 48 to 99, which comprise the balance sheets of the Group and the
Company as at 31 December 2016, the statements of changes in equity of the Group and the Company, the
consolidated income statement, consolidated statement of comprehensive income and consolidated cash fl ow
statement of the Group for the fi nancial year then ended, and notes to the fi nancial statements, including a
summary of signifi cant accounting policies.
In our opinion, the accompanying consolidated fi nancial statements of the Group, the balance sheet and the
statement of changes in equity of the Company are properly drawn up in accordance with the provisions of the
Companies Act, Chapter 50 (the Act) and Financial Reporting Standards in Singapore (FRSs) so as to give a
true and fair view of the consolidated fi nancial position of the Group and the fi nancial position of the Company
as at 31 December 2016 and of the consolidated fi nancial performance, consolidated changes in equity and
consolidated cash fl ows of the Group and changes in equity of the Company for the year ended on that date.
Basis for Opinion
We conducted our audit in accordance with Singapore Standards on Auditing (SSAs). Our responsibilities
under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Statements section of our report. We are independent of the Group in accordance with the Accounting and
Corporate Regulatory Authority (ACRA) Code of Professional Conduct and Ethics for Public Accountants and
Accounting Entities (ACRA Code) together with the ethical requirements that are relevant to our audit of the
fi nancial statements in Singapore, and we have fulfi lled our other ethical responsibilities in accordance with
these requirements and the ACRA Code. We believe that the audit evidence we have obtained is suffi cient and
appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most signifi cance in our audit
of the fi nancial statements of the current period. These matters were addressed in the context of our audit of
the fi nancial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters. For each matter below, our description of how our audit addressed the matter is
provided in that context.
We have fulfi lled our responsibilities described in the Auditor’s responsibilities for the audit of the fi nancial
statements section of our report, including in relation to these matters. Accordingly, our audit included the
performance of procedures designed to respond to our assessment of the risks of material misstatement of the
fi nancial statements. The results of our audit procedures, including the procedures performed to address the
matters below, provide the basis for our audit opinion on the accompanying fi nancial statements.
Revenue Recognition
Revenue for the year ended 31 December 2016 amounted to US$988.2 million. Revenue from the sale of
goods is recognised upon the transfer of signifi cant risks and rewards of ownership of the goods to the
customer, usually on delivery of goods. The Group uses a variety of shipment terms across its operating
markets and this has an impact on the timing of revenue recognition. There is a higher risk that revenue could
be recognised in the incorrect period for sales transactions occurring on and around the year end.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 45
Independent Auditor’s Report
To the Members of Excelpoint Technology Ltd
For the fi nancial year ended 31 December 2016
Key Audit Matters (cont’d)
Revenue Recognition (cont’d)
As part of our audit procedures, we evaluated the appropriateness of the Group’s revenue recognition
accounting policies. We obtained an understanding of management’s internal controls over the revenue
process and placed specific attention on the timing of the revenue recognition. We performed sales
transactions testing based on a representative sampling of the sales orders to ensure that the related revenues
and trade receivables are recorded appropriately taking into consideration the terms and conditions of the
sale orders, including the shipping terms. We also performed sales cut off procedures by agreeing deliveries
occurring around the year end to supporting documentation to establish that sales and corresponding trade
receivables are properly recorded in the correct period. We also considered the adequacy of the disclosures in
respect of revenues in Note 4.
Recoverability of trade receivables
The gross balance of trade receivables as at 31 December 2016 amounted to US$154.3 million, against which
allowance for doubtful debts amounting to US$0.1 million was made. The collectability of trade receivables
is a key element of the Group’s working capital management, which is managed on an ongoing basis by
local management of the subsidiaries. The Group’s management supports subsidiaries in setting credit limits
for customers and approves such limits above certain thresholds, where applicable. The assessment of the
impairment of trade receivables requires signifi cant management judgment in assessing the trade debtors’
ability to pay, which in turn impacts the recoverability of the Group’s receivables.
We evaluated the Group’s processes and controls relating to the monitoring of trade receivables and review
of credit risks of customers. Our audit procedures included, amongst others, evaluating management’s
assessment of the credit review procedures of trade receivables, obtaining trade receivable confi rmations, and
obtaining evidence of receipts from the trade receivables after the year end. We also evaluated management’s
assumptions used to determine the trade receivables impairment amount, through detailed analyses of ageing
of receivables, assessment of material overdue individual trade receivables and risks specifi c to the trade
debtors. We assessed the adequacy of the Group’s disclosures on the trade receivables in Note 14 and the
related risks such as credit risk and liquidity risk in Notes 27(a) and 27(b).
Provision for slow-moving and obsolete stocks
The gross balance of stocks as at 31 December 2016 is US$133.2 million, against which provision for slow-
moving and obsolete stocks amounting to US$1.6 million was made. Stock balances comprise fi nished
products. The determination of provision for slow-moving and obsolete stocks requires management to
exercise judgment in identifying slow-moving and obsolete stocks and make estimates of the appropriate
level of provision required. This process also involves management to consider the different stock rotation and
price protection arrangements with certain suppliers and this makes the process complex. This process is also
subject to uncertainty arising from rapid technological changes given the nature of the Group’s stocks.
As part of our audit of the carrying value of stock, we evaluated the analyses and assessments made by
management with respect to carrying value and slow-moving and obsolete stocks, and the expected demand
and market value related to fi nished products. We tested ageing of stocks and evaluated management’s
analysis of slow-moving stocks on selected samples. We also inquired of management to obtain an
understanding of the terms of the different stock rotation and price protection arrangements that the Group
has with its suppliers and corroborated our understanding by performing a review of the signifi cant terms and
conditions in supplier contracts. We also assessed the adequacy of the disclosures related to stocks in Note
16.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201646
Independent Auditor’s ReportTo the Members of Excelpoint Technology Ltd
For the fi nancial year ended 31 December 2016
Other Information
Management is responsible for other information. The other information comprises the information included in
the annual report, but does not include the fi nancial statements and our auditor’s report thereon.
Our opinion on the fi nancial statements does not cover the other information and we do not express any form
of assurance conclusion thereon. In connection with our audit of the fi nancial statements, our responsibility is
to read the other information and, in doing so, consider whether the other information is materially inconsistent
with the fi nancial statements or our knowledge obtained in the audit or otherwise appears to be materially
misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management and Directors for the fi nancial statements
Management is responsible for the preparation of fi nancial statements that give a true and fair view in
accordance with the provisions of the Act and FRSs, and for devising and maintaining a system of internal
accounting controls suffi cient to provide a reasonable assurance that assets are safeguarded against loss
from unauthorised use or disposition; and transactions are properly authorised and that they are recorded
as necessary to permit the preparation of true and fair fi nancial statements and to maintain accountability of
assets.
In preparing the fi nancial statements, management is responsible for assessing the Group’s ability to continue
as a going concern, disclosing, as applicable, matters related to going concern and using the going concern
basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no
realistic alternative but to do so. The directors’ responsibilities include overseeing the Group’s fi nancial reporting
process.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the fi nancial statements as a whole are free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our
opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with SSAs will always detect a material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected
to infl uence the economic decisions of users taken on the basis of these fi nancial statements.
As part of an audit in accordance with SSAs, we exercise professional judgement and maintain professional
scepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the fi nancial statements, whether due to fraud
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence
that is suffi cient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve
collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Group’s internal control.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 47
Independent Auditor’s Report
To the Members of Excelpoint Technology Ltd
For the fi nancial year ended 31 December 2016
Auditor’s Responsibilities for the Audit of the Financial Statements (cont’d)
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast signifi cant doubt on the Group’s ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to
the related disclosures in the fi nancial statements or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report.
However, future events or conditions may cause the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the fi nancial statements, including the
disclosures, and whether the fi nancial statements represent the underlying transactions and events in a
manner that achieves fair presentation.
• Obtain suffi cient appropriate audit evidence regarding the fi nancial information of the entities or
business activities within the Group to express an opinion on the consolidated fi nancial statements.
We are responsible for the direction, supervision and performance of the group audit. We remain solely
responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of the
audit and signifi cant audit fi ndings, including any signifi cant defi ciencies in internal control that we identify
during our audit. We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters that
may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the directors, we determine those matters that were of most signifi cance
in the audit of the fi nancial statements of the current period and are therefore the key audit matters. We
describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the
matter or when, in extremely rare circumstances, we determine that a matter should not be communicated
in our report because the adverse consequences of doing so would reasonably be expected to outweigh the
public interest benefi ts of such communication.
Report on other legal and regulatory requirements
In our opinion, the accounting and other records required by the Act to be kept by the Company and by those
subsidiary corporations incorporated in Singapore of which we are the auditors have been properly kept in
accordance with the provisions of the Act.
The engagement partner on the audit resulting in this independent auditor’s report is Tham Chee Soon.
Ernst & Young LLP
Public Accountants and Chartered Accountants
Singapore
28 February 2017
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201648
CONSOLIDATED INCOMESTATEMENTFor the fi nancial year ended 31 December 2016
The accompanying accounting policies and explanatory notes form an integral part of the fi nancial statements.
GroupNote 2016 2015
US$’000 US$’000
Revenue 4 988,240 828,283
Cost of sales (933,128) (780,541)
Gross profi t 55,112 47,742
Other income 5 531 653
Sales and distribution costs (29,832) (26,739)
General and administrative expenses (15,664) (13,268)
Interest expense 6 (2,472) (1,786)
Other expenses 7 830 (1,103)
Profi t before taxation 7 8,505 5,499
Income tax expense 8 (1,452) (1,144)
Profi t for the year and attributable to equity holders of the Company 7,053 4,355
Earnings per share attributable to equity holders of the Company (cents per share) 9 6.65 4.26
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 49
CONSOLIDATED STATEMENT OFCOMPREHENSIVE INCOME
For the fi nancial year ended 31 December 2016
The accompanying accounting policies and explanatory notes form an integral part of the fi nancial statements.
GroupNote 2016 2015
US$’000 US$’000
Profi t for the year 7,053 4,355
Other comprehensive income:-Items that may be reclassifi ed subsequently to profi t or loss:-Foreign currency translation (14) (20)
Reclassifi cation of foreign currency translation reserve to profi t or loss
upon strike-off of subsidiary 107 –
Net gain/ (loss) on fair value changes of available-for-sale fi nancial assets 1 (414)
Other comprehensive income for the year 94 (434)
Total comprehensive income for the year and attributable to equity holders of the Company 7,147 3,921
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201650
BALANCESHEETSAs at 31 December 2016
The accompanying accounting policies and explanatory notes form an integral part of the fi nancial statements.
Group CompanyNote 2016 2015 2016 2015
US$’000 US$’000 US$’000 US$’000
Non-current assetsProperty, plant and equipment 10 2,577 1,870 – –
Intangible assets 11 519 326 – –
Investments in subsidiaries 12 – – 9,878 13,049
Investment securities 13 1,793 1,756 1,793 1,756
Deferred tax assets 22 18 30 – –
4,907 3,982 11,671 14,805
Current assetsTrade debtors 14 154,236 135,238 6 5
Other debtors 15 1,143 891 – –
Prepayments 353 295 2 2
Stocks 16 131,598 111,613 – –
Amounts due from subsidiaries 17 – – 26,551 18,759
Cash and short-term deposits 18 16,606 10,724 2,841 881
303,936 258,761 29,400 19,647
Current liabilitiesTrade creditors and accruals 19 (100,092) (93,088) (882) (449)
Other creditors 20 (13,771) (10,235) (18) (24)
Interest-bearing loans and borrowings 21 (123,501) (99,445) – –
Amounts due to subsidiaries 17 – – – (78)
Provision for taxation (3,221) (2,792) (16) (14)
(240,585) (205,560) (916) (565)
Net current assets 63,351 53,201 28,484 19,082
Net assets 68,258 57,183 40,155 33,887
Equity attributable to equity holders of the Company Share capital 23 38,244 32,410 38,244 32,410
Reserves 30,014 24,773 1,911 1,477
68,258 57,183 40,155 33,887
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 51
STATEMENTS OFCHANGES IN EQUITY
For the fi nancial year ended 31 December 2016
The accompanying accounting policies and explanatory notes form an integral part of the fi nancial statements.
Attributable to equity holders of the Company
GroupEquity,total
Share capital
(Note 23)Reserves,
totalRevenue reserve
Fair value reserve (Note 24(c))
Statutory reserve
fund (Note 24(a))
Foreign currency
translation reserve (Note 24(b))
Othercapitalreserve(Note 24(d))
US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000
2016
Opening balance at
1 January 2016 57,183 32,410 24,773 25,454 263 25 (1,196) 227
Profi t for the year 7,053 – 7,053 7,053 – – – –
Other comprehensive
income
Items that may be reclassifi ed
subsequently to profi t or
loss:-
Foreign currency translation (14) – (14) – – – (14) –
Reclassifi cation of foreign
currency translation reserve
to profi t or loss upon strike-
off of subsidiary 107 – 107 – – – 107 –
Net gain on fair value
changes of available-for-sale
fi nancial assets 1 – 1 – 1 – – –
Other comprehensive income for the year 94 – 94 – 1 – 93 –
Total comprehensive income for the year 7,147 – 7,147 7,053 1 – 93 –
Distributions to equity holders
Issuance of new shares 5,834 5,834 – – – – – –
Dividends on ordinary
shares (Note 33) (1,906) – (1,906) (1,906) – – – –
Total distributions to equity holders 3,928 5,834 (1,906) (1,906) – – – –
Closing balance at 31 December 2016 68,258 38,244 30,014 30,601 264 25 (1,103) 227
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201652
STATEMENTS OFCHANGES IN EQUITYFor the fi nancial year ended 31 December 2016
The accompanying accounting policies and explanatory notes form an integral part of the fi nancial statements.
Attributable to equity holders of the Company
GroupEquity,total
Share capital
(Note 23)Reserves,
totalRevenue reserve
Fair value reserve (Note 24(c))
Statutory reserve
fund (Note 24(a))
Foreign currency
translation reserve (Note 24(b))
Othercapitalreserve(Note 24(d))
US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000
2015
Opening balance at
1 January 2015 56,227 32,294 23,933 24,180 677 25 (1,176) 227
Profi t for the year 4,355 – 4,355 4,355 – – – –
Other comprehensive income
Items that may be reclassifi ed
subsequently to profi t or
loss:-
Foreign currency translation (20) – (20) – – – (20) –
Net loss on fair value
changes of available-for-sale
fi nancial assets (414) – (414) – (414) – – –
Other comprehensive income for the year (434) – (434) – (414) – (20) –
Total comprehensive income for the year 3,921 – 3,921 4,355 (414) – (20) –
Distributions to equity holders
Issuance of new shares 116 116 – – – – – –
Dividends on ordinary
shares (Note 33) (3,081) – (3,081) (3,081) – – – –
Total distributions to equity holders (2,965) 116 (3,081) (3,081) – – – –
Closing balance at 31 December 2015 57,183 32,410 24,773 25,454 263 25 (1,196) 227
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 53
STATEMENTS OFCHANGES IN EQUITY
For the fi nancial year ended 31 December 2016
The accompanying accounting policies and explanatory notes form an integral part of the fi nancial statements.
Company
Attributable to equity holders of the Company
Equity,total
Sharecapital
(Note 23)Reserves,
totalRevenueReserve
Fair value reserve
fund(Note 24(c))
Othercapitalreserve(Note 24(d))
US$’000 US$’000 US$’000 US$’000 US$’000 US$’000
2016Opening balance at 1 January 2016 33,887 32,410 1,477 987 263 227
Profi t for the year 2,339 – 2,339 2,339 – –
Other comprehensive income
Net gain on fair value changes of
available-for-sale fi nancial assets 1 – 1 – 1 –
Other comprehensive income for the year 1 – 1 – 1 –
Total comprehensive income for the year 2,340 – 2,340 2,339 1 –
Distributions to equity holders
Issuance of new shares 5,834 5,834 – – – –
Dividends on ordinary shares (Note 33) (1,906) – (1,906) (1,906) – –
Total distributions to equity holders 3,928 5,834 (1,906) (1,906) – –
Closing balance at 31 December 2016 40,155 38,244 1,911 1,420 264 227
2015Opening balance at 1 January 2015 33,855 32,294 1,561 657 677 227
Profi t for the year 3,411 – 3,411 3,411 – –
Other comprehensive income
Net loss on fair value changes of
available-for-sale fi nancial assets (414) – (414) – (414) –
Other comprehensive income for the year (414) – (414) – (414) –
Total comprehensive income for the year 2,997 – 2,997 3,411 (414) –
Distributions to equity holders
Issuance of new shares 116 116 – – – –
Dividends on ordinary shares (Note 33) (3,081) – (3,081) (3,081) – –
Total distributions to equity holders (2,965) 116 (3,081) (3,081) – –
Closing balance at 31 December 2015 33,887 32,410 1,477 987 263 227
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201654
CONSOLIDATED CASH FLOWSTATEMENTFor the fi nancial year ended 31 December 2016
The accompanying accounting policies and explanatory notes form an integral part of the fi nancial statements.
Group2016 2015
US$’000 US$’000
Operating activitiesProfi t before taxation 8,505 5,499
Adjustments for:-
Interest income (26) (34)
Interest expense 2,472 1,786
Depreciation of property, plant and equipment 755 812
Dividend income from investment securities (177) (191)
Loss on disposal of property, plant and equipment 23 2
Reclassifi cation of foreign currency translation reserve to profi t or loss upon
strike-off of subsidiary 107 –
Net fair value loss on fi nancial instruments – 24
Share based payments under EPSS 100 70
Operating cash fl ows before changes in working capital 11,759 7,968
Changes in working capital:-
Increase in stocks (19,985) (18,555)
Increase in trade debtors, other debtors and prepayments (19,308) (19,819)
Increase in trade creditors, accruals and other creditors 10,540 16,208
Cash fl ows used in operations (16,994) (14,198)
Interest received 26 34
Interest paid (2,472) (1,786)
Income tax paid (1,011) (308)
Net cash fl ows used in operating activities (20,451) (16,258)
Investing activitiesPurchase of property, plant and equipment (1,601) (368)
Proceeds on disposals of property, plant and equipment 118 –
Purchase of club memberships (193) –
Dividend income from investment securities 140 106
Net cash fl ows used in investing activities (1,536) (262)
Financing activitiesIncrease in interest-bearing loans and borrowings 24,056 18,494
Dividend paid on ordinary shares (1,906) (3,081)
Proceeds from issuance of ordinary shares 5,734 –
Net cash fl ows generated from fi nancing activities 27,884 15,413
Net increase/ (decrease) in cash and short-term deposits 5,897 (1,107)
Effects of exchange rate changes on cash and short-term deposits (15) (16)
Cash and cash equivalents at 1 January 10,724 11,847
Cash and short-term deposits at 31 December (Note 18) 16,606 10,724
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 55
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
1. Corporate information
Excelpoint Technology Ltd (the “Company”) is a limited liability company incorporated and domiciled in
Singapore and is listed on the Singapore Exchange Securities Trading Limited (“SGX-ST”).
The registered offi ce and principal place of business of the Company is located at 15 Changi Business
Park Central 1, #06-00, Singapore 486057.
The principal activities of the Company are that of an investment holding company and the provision
of support services to its subsidiaries. The principal activities of the subsidiaries include the trading
of electronics equipment, sale and distribution of electronic components and dealers of all types of
electronic and electrical components and accessories.
2. Summary of signifi cant accounting policies
2.1 Basis of preparation
The consolidated fi nancial statements of the Group and the balance sheet and statement of changes in
equity of the Company have been prepared in accordance with Singapore Financial Reporting Standards
(“FRS”).
The fi nancial statements have been prepared on a historical cost basis except as disclosed in the
accounting policies below.
The fi nancial statements are presented in United States Dollars (“USD” or “US$”) and all values are
rounded to the nearest thousand (US$’000) except when otherwise indicated.
The Accounting Standards Council announced on 29 May 2014 that Singapore incorporated companies
listed on the Singapore Exchange will apply a new fi nancial reporting framework identical to the
International Financial Reporting Standards. The Group will adopt the new fi nancial reporting framework
on 1 January 2018.
2.2 Changes in accounting policies
The accounting policies adopted are consistent with those of the previous fi nancial year except in the
current fi nancial year, the Group has adopted all the new and revised standards which are effective for
annual fi nancial period beginning on 1 January 2016. The adoption of these standards did not have any
effect on the fi nancial performance or position of the Group and the Company.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201656
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.3 Standards issued but not yet effective
The Group has not adopted the following standards that have been issued but not yet effective:-
Description Effective for annual
periods beginning
on or after
Amendments to FRS 7 Disclosure Initiative 1 January 2017
Amendments to FRS 12 Recognition of Deferred Tax Assets for Unrealised Losses 1 January 2017
FRS 109 Financial Instruments 1 January 2018
FRS 115 Revenue from Contracts with Customers 1 January 2018
Amendments to FRS 102 Classifi cation and Measurement of Share-based Payment
Transaction
1 January 2019
FRS 116 Leases 1 January 2019
Except for FRS 109, FRS 115 and FRS 116, the directors expect that the adoption of the other
standards above will have no material impact on the fi nancial statements in the period of initial
application. The nature of the impending changes in accounting policy on adoption of FRS 109, FRS
115 and FRS 116 is described below.
FRS 115 Revenue from Contracts with Customers
FRS 115 establishes a fi ve-step model to account for revenue arising from contracts with customers.
Under FRS 115, revenue is recognised at an amount that refl ects the consideration which an entity
expects to be entitled in exchange for transferring goods or services to a customer.
The new revenue standard will supersede all current revenue recognition requirements under FRS. Either
a full retrospective application or a modifi ed retrospective application is required for annual periods
beginning on or after 1 January 2018. Early adoption is permitted.
During 2016, the Group performed a preliminary assessment of FRS 115 which is subject to changes
arising from a more detailed ongoing analysis. The Group is in a business of trading of electronics
equipment, sale and distribution of electronic components and dealers of all types of electronic and
electrical components and accessories. The Group expects the following impact upon adoption of FRS
115:-
Variable consideration
Some contracts with customers provide trade discounts or volume rebates. Currently, the Group
recognises revenue from the sale of goods measured at the fair value of the consideration received or
receivable, net of returns and allowance, trade discounts and volume rebates. If revenue cannot be
reliably measured, the Group defers revenue recognition until the uncertainty is resolved. Such provisions
give rise to variable consideration under FRS 115, and will be required to be estimated at contract
inception. FRS 115 requires the estimated variable consideration to be constrained to prevent over-
recognition of revenue. The Group continues to assess individual contracts to determine the estimated
variable consideration and related constraint. At this stage, the Group does not expect any signifi cant
impact to arise from these changes.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 57
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.3 Standards issued but not yet effective (cont’d)
FRS 115 Revenue from Contracts with Customers (cont’d)
Transition
The Group plans to adopt the new standard on the required effective date using the full retrospective
method and apply all the practical expedients available for full retrospective approach under FRS 115.
FRS 109 Financial Instruments
FRS 109 introduces new requirements for classification and measurement of financial assets,
impairment of fi nancial assets and hedge accounting. Financial assets are classifi ed according to their
contractual cash fl ow characteristics and the business model under which they are held. The impairment
requirements in FRS 109 are based on an expected credit loss model and replace the FRS 39 incurred
loss model.
(a) Classifi cation and measurement
The Group expects to have mixed business model. The Group intends to hold its currently held-
to-maturity debt instruments assets to collect contractual cash fl ows, and accordingly measured
at amortised cost when it applies FRS 109. The Group does not expect any signifi cant impact to
arise from these changes.
(b) Impairment
FRS 109 requires the Group to record expected credit losses on all of its loans and trade
receivables, either on a 12-month or lifetime basis. The Group expects to apply the simplifi ed
approach and record lifetime expected losses on all trade receivables. Upon application of the
expected credit loss model, the Group expects a signifi cant impact on its equity due to unsecured
nature of its loans and receivables, but it will need to perform a more detailed analysis which
considers all reasonable and supportable information, including forward-looking elements to
determine the extent of impact.
Transition
The Group plans to adopt the new standard on the required effective date without restating prior
periods’ information and recognises any difference between the previous carrying amount and the
carrying amount at the beginning of the annual reporting period at the date of initial application in the
opening retained earnings.
FRS 116 Leases
FRS 116 requires lessees to recognise most leases on balance sheets to refl ect the rights to use the
leased assets and the associated obligations for lease payments as well as the corresponding interest
expense and depreciation charges. The standard includes two recognition exemption for lessees –
leases of ‘low value’ assets and short term leases. The new standard is effective for annual periods
beginning on or after 1 January 2019.
The Group is currently assessing the impact of the new standard and plans to adopt the new standard
on the required effective date. The Group expects the adoption of the new standard will result in
increase in total assets and total liabilities, EBITDA and gearing ratio.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201658
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.4 Basis of consolidation and business combinations
(a) Basis of consolidation
Basis of consolidation from 1 January 2010
The consolidated fi nancial statements comprise the fi nancial statements of the Company and its
subsidiaries as at the reporting period. The fi nancial statements of the subsidiaries used in the
preparation of the consolidated fi nancial statements are prepared for the same reporting date as
the Company. Consistent accounting policies are applied to like transactions and events in similar
circumstances.
All intra-group balances, income and expenses and unrealised gains and losses resulting from
intra-group transactions are eliminated in full.
Subsidiaries are consolidated from the date of acquisition, being the date on which the Group
obtains control, and continue to be consolidated until the date that such control ceases.
Losses within a subsidiary are attributed to the non-controlling interest even if that results in a
defi cit balance.
Basis of consolidation prior to 1 January 2010
A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as
an equity transaction. If the Group loses control over a subsidiary, it:-
— De-recognises the assets (including goodwill) and liabilities of the subsidiary at their carrying
amounts at the date when control is lost;
— De-recognises the carrying amount of any non-controlling interest;
— De-recognises the cumulative translation differences recorded in equity;
— Recognises the fair value of the consideration received;
— Recognises the fair value of any investment retained;
— Recognises any surplus or defi cit in profi t or loss; and
— Re-classifies the Group’s share of components previously recognised in other
comprehensive income to profi t or loss or retained earnings, as appropriate.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 59
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.4 Basis of consolidation and business combinations (cont’d)
(a) Basis of consolidation (cont’d)
Basis of consolidation prior to 1 January 2010 (cont’d)
Certain of the above-mentioned requirements were applied on a prospective basis. The
following differences, however, are carried forward in certain instances from the previous basis of
consolidation:-
— Acquisition of non-controlling interests, prior to 1 January 2010, were accounted for using
the parent entity extension method, whereby the difference between the consideration and
the book value of the share of the net assets acquired were recognised in goodwill.
— Losses incurred by the Group were attributed to the non-controlling interest until the
balance was reduced to nil. Any further losses were attributed to the Group, unless the
non-controlling interest had a binding obligation to cover these. Losses prior to 1 January
2010 were not reallocated between non-controlling interest and the owners of the
Company.
— Upon loss of control, the Group accounted for the investment retained at its proportionate
share of net asset value at the date control was lost. The carrying values of such
investments as at 1 January 2010 have not been restated.
(b) Business combinations
Business combination from 1 January 2010
Business combinations are accounted for by applying the acquisition method. Identifi able assets
acquired and liabilities assumed in a business combination are measured initially at their fair values
at the acquisition dates. Acquisition-related costs are recognised as expenses in the periods in
which the costs are incurred and the services are received.
When the Group acquired a business, it assesses the fi nancial assets and liabilities assumed for
appropriate classifi cation and designation in accordance with the contractual terms, economic
circumstances and pertinent conditions as at the acquisition date. This includes the separation of
embedded derivatives in host contracts by the acquiree.
Any contingent consideration to be transferred by the acquirer will be recognised at fair value at
the acquisition date. Subsequent changes to the fair value of the contingent consideration which
is deemed to be an asset or liability, will be recognised in accordance with FRS 39 either in profi t
or loss or as a change to other comprehensive income. If the contingent consideration is classifi ed
as equity, it is not remeasured until it is fi nally settled within equity.
In business combinations achieved in stages, previously held equity interests in the acquiree are
remeasured to fair value at the acquisition date and any corresponding gain or loss is recognised
in profi t or loss.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201660
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.4 Basis of consolidation and business combinations (cont’d)
(b) Business combinations (cont’d)
Business combination from 1 January 2010 (cont’d)
The Group elects for each individual business combination, whether non-controlling interest in the
acquiree (if any), that are present ownership interests and entitle their holders to a proportionate
share of net assets in the event of liquidation, is recognised on the acquisition date at fair value, or
at the non-controlling interest’s proportionate share of the acquiree’s identifi able net assets. Other
components of non-controlling interests are measured at their acquisition date fair value, unless
another measurement basis is required by another FRS.
Any excess of the sum of the fair value of the consideration transferred in the business
combination, the amount of non-controlling interest in the acquiree (if any), and the fair value of
the Group’s previously held equity interest in the acquiree (if any), over the net fair value of the
acquiree’s identifi able assets and liabilities is recorded as goodwill. In instances where the latter
amount exceeds the former, the excess is recognised as gain on bargain purchase in profi t or loss
on the acquisition date.
Business combination prior to 1 January 2010
In comparison to the above-mentioned requirements, the following differences applied:-
Business combinations are accounted for by applying the purchase method. Transaction costs
directly attributable to the acquisition formed part of the acquisition costs. The non-controlling
interest (formerly known as minority interest) was measured at the proportionate share of the
acquiree’s identifi able net assets.
Business combinations achieved in stages were accounted for as separate steps. Adjustments to
those fair values relating to previously held interests are treated as a revaluation and recognised in
equity. Any additional acquired share of interest did not affect previously recognised goodwill.
When the Group acquired a business, embedded derivatives separated from the host contract by
the acquiree were not reassessed on acquisition unless the business combination resulted in a
change in the terms of the contract that signifi cantly modifi ed the cash fl ows that otherwise would
have been required under the contract.
Contingent consideration was recognised if, and only if, the Group had a present obligation, the
economic outfl ow was more likely than not and a reliable estimate was determinable. Subsequent
adjustments to the contingent consideration were recognised as part of goodwill.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 61
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.5 Foreign currency
The fi nancial statements are presented in United States Dollars, which is also the Company’s functional
currency. Each entity in the Group determines its own functional currency and items included in the
fi nancial statements of each entity are measured using that functional currency.
(a) Transactions and balances
Transactions in foreign currencies are measured in the respective functional currencies of the
Company and its subsidiaries and are recorded on initial recognition in the functional currencies at
exchange rates approximating those ruling at the transaction dates. Monetary assets and liabilities
denominated in foreign currencies are translated at the rate of exchange ruling at the end of the
reporting period. Non-monetary items that are measured in terms of historical cost in a foreign
currency are translated using the exchange rates as at the dates of the initial transactions. Non-
monetary items measured at fair value in a foreign currency are translated using the exchange
rates at the date when the fair value was measured.
Exchange differences arising on the settlement of monetary items or on translating monetary items
at the end of the reporting period are recognised in profi t or loss except for exchange differences
arising on monetary items that form part of the Group’s net investment in foreign operations,
which are recognised initially in other comprehensive income and accumulated under foreign
currency translation reserve in equity. The foreign currency translation reserve is reclassifi ed from
equity to profi t or loss of the Group on disposal of the foreign operation.
(b) Consolidated fi nancial statements
For consolidation purpose, the assets and liabilities of foreign operations are translated into
USD at the rate of exchange ruling at the end of the reporting period and their profi t or loss
are translated at the exchange rates prevailing at the date of the transactions. The exchange
differences arising on the translation are recognised in other comprehensive income. On disposal
of a foreign operation, the component of other comprehensive income relating to that particular
foreign operation is recognised in profi t or loss.
In the case of a partial disposal without loss of control of a subsidiary that includes a foreign
operation, the proportionate share of the cumulative amount of the exchange differences are re-
attributed to non-controlling interest and are not recognised in profi t or loss. For partial disposals
of associates or jointly controlled entities that are foreign operations, the proportionate share of
the accumulated exchange differences is reclassifi ed to profi t or loss.
2.6 Property, plant and equipment
All items of property, plant and equipment are initially recorded at cost. Subsequent to recognition,
property, plant and equipment other than freehold land and buildings are measured at cost less
accumulated depreciation and any accumulated impairment losses. The cost includes the cost of
replacing part of the property, plant and equipment and borrowing costs that are directly attributable to
the acquisition, construction or production of a qualifying property, plant and equipment. The accounting
policy for borrowing costs is set out in Note 2.17. The cost of an item of property, plant and equipment
is recognised as an asset if, and only if, it is probable that future economic benefi ts associated with the
item will fl ow to the Group and the cost of the item can be measured reliably.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201662
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.6 Property, plant and equipment (cont’d)
When signifi cant parts of property, plant and equipment are required to be replaced in intervals, the
Group recognises such parts as individual assets with specifi c useful lives and depreciation, respectively.
Likewise, when a major inspection is performed, its cost is recognised in the carrying amount of the
plant and equipment as a replacement if the recognition criteria are satisfi ed. All other repair and
maintenance costs are recognised in profi t or loss as incurred.
Depreciation is computed on a straight-line basis over the estimated useful lives of the assets as
follows:-
Leasehold building - 40 years (remaining lease of the land)
Furniture and fi ttings - 5 years
Offi ce equipment - 3 - 5 years
Motor vehicles - 4 - 10 years
Computers - 3 - 5 years
Renovations - the lower of remaining lease period and 5 years
The carrying values of property, plant and equipment are reviewed for impairment when events or
changes in circumstances indicate that the carrying value may not be recoverable.
The residual value, useful life and depreciation method are reviewed at each fi nancial year-end and
adjusted prospectively, if appropriate.
An item of property, plant and equipment is derecognised upon disposal or when no future economic
benefi ts are expected from its use or disposal. Any gain or loss on derecognition of the asset is included
in profi t or loss in the year the asset is derecognised.
2.7 Intangible assets
Intangible assets consisting of club memberships are initially recorded at cost. Following initial
recognition, club memberships are carried at cost less any accumulated impairment losses. The
useful lives of club memberships are assessed to be indefi nite as these are lifetime memberships
and have no dates of expiry and are tested for impairment annually, or more frequently if the events
and circumstances indicate that the carrying value may be impaired either individually or at the cash-
generating unit level. Such intangible assets are not amortised. The useful life of an intangible asset with
an indefi nite useful life is reviewed annually to determine whether the useful life assessment continues to
be supportable. If not, the change in useful life from indefi nite to fi nite is made on a prospective basis.
Gains or losses arising from derecognition of an intangible asset are measured as the difference between
the net disposal proceeds and the carrying amount of the asset and are recognised in the profi t or loss
when the asset is derecognised.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 63
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.8 Impairment of non-fi nancial assets
The Group assesses at each reporting date whether there is an indication that an asset may be
impaired. If any such indication exists, or when annual impairment testing for an asset is required, the
Group makes an estimate of the asset’s recoverable amount.
An asset’s recoverable amount is the higher of an asset’s or cash-generating unit’s fair value less costs
of disposal and its value in use and is determined for an individual asset, unless the asset does not
generate cash infl ows that are largely independent of those from other assets or groups of assets.
Where the carrying amount of an asset or cash-generating unit exceeds its recoverable amount, the
asset is considered impaired and written down to its recoverable amount. In assessing value in use, the
estimated future cash fl ows expected to be generated by the asset are discounted to their present value
using a pre-tax discount rate that refl ects current market assessments of the time value of money and
the risks specifi c to the asset. In determining fair value less costs of disposal, recent market transactions
are taken into account, if available. If no such transaction can be identifi ed, an appropriate valuation
model is used.
The Group bases its impairment calculation on detailed budgets and forecast calculations which are
prepared separately for each of the Group’s cash-generating units to which the individual assets are
allocated. These budgets and forecast calculations are generally covering a period of three years. For
longer periods, a long-term growth rate is calculated and applied to project future cash fl ows after the
third year.
Impairment losses of continuing operations are recognised in profi t or loss, except for assets that are
previously revalued where the revaluation was taken to other comprehensive income. In this case,
the impairment is also recognised in other comprehensive income up to the amount of any previous
revaluation.
For assets excluding goodwill, an assessment is made at each reporting date as to whether there is any
indication that previously recognised impairment losses may no longer exist or may have decreased. If
such indication exists, the Group estimates the asset’s or cash-generating unit’s recoverable amount.
A previously recognised impairment loss is reversed only if there has been a change in the estimates
used to determine the asset’s recoverable amount since the last impairment loss was recognised. If
that is the case, the carrying amount of the asset is increased to its recoverable amount. That increase
cannot exceed the carrying amount that would have been determined, net of depreciation, had no
impairment loss been recognised previously. Such reversal is recognised in profi t or loss unless the
asset is measured at revalued amount, in which case the reversal is treated as a revaluation increase.
2.9 Subsidiaries
A subsidiary is an investee that is controlled by the Group. The Group controls an investee when it is
exposed, or has rights, to variable returns from its involvement with the investee and has the ability to
affect those returns through its power over the investee.
In the Company’s separate fi nancial statements, investments in subsidiaries are accounted for at cost
less impairment losses.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201664
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.10 Financial Instruments
(a) Financial assets
Initial recognition and measurement
Financial assets are recognised when, and only when, the Group becomes a party to the
contractual provisions of the fi nancial instrument. The Group determines the classifi cation of its
fi nancial assets at initial recognition.
When fi nancial assets are recognised initially, they are measured at fair value, plus, in the case of
fi nancial assets not at fair value through profi t or loss, directly attributable transaction costs.
Subsequent measurement
The subsequent measurement of fi nancial assets depends on their classifi cation as follows:-
(i) Financial assets at fair value through profi t or loss
Financial assets at fair value through profi t or loss include fi nancial assets held for trading.
Financial assets are classifi ed as held for trading if they are acquired for the purpose of
selling or repurchasing in the near term. This category includes derivative financial
instruments entered into by the Group that are not designated as hedging instruments in
hedge relationships as defi ned by FRS 39. Derivatives, including separated embedded
derivatives are also classifi ed as held for trading unless they are designated as effective
hedging instruments.
Subsequent to initial recognition, fi nancial assets at fair value through profi t or loss are
measured at fair value. Any gains or losses arising from changes in fair value of the fi nancial
assets are recognised in profi t or loss. Net gains or net losses on fi nancial assets at fair
value through profi t or loss include exchange differences, interest and dividend income.
Derivatives embedded in host contracts are accounted for as separate derivatives and
recorded at fair value if their economic characteristics and risks are not closely related
to those of the host contracts and the host contracts are not measured at fair value
with changes in fair value recognised in profi t or loss. These embedded derivatives are
measured at fair value with changes in fair value recognised in profi t or loss. Reassessment
only occurs if there is a change in the terms of the contract that signifi cantly modifi es the
cash fl ows that would otherwise be required.
(ii) Loans and receivables
Non-derivative fi nancial assets with fi xed or determinable payments that are not quoted in
an active market are classifi ed as loans and receivables. Subsequent to initial recognition,
loans and receivables are measured at amortised cost using the effective interest method,
less impairment. Gains and losses are recognised in profi t or loss when the loans and
receivables are derecognised or impaired, and through the amortisation process.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 65
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.10 Financial Instruments (cont’d)
(a) Financial assets (cont’d)
Subsequent measurement (cont’d)
(iii) Available-for-sale fi nancial assets
Available-for-sale fi nancial assets include equity and debt securities. Equity investments
classifi ed as available-for sale are those, which are neither classifi ed as held for trading nor
designated at fair value through profi t or loss. Debt securities in this category are those
which are intended to be held for an indefi nite period of time and which may be sold in
response to needs for liquidity or in response to changes in the market conditions.
After initial recognition, available-for-sale fi nancial assets are subsequently measured at fair
value. Any gains or losses from changes in fair value of the fi nancial asset are recognised in
other comprehensive income, except that impairment losses, foreign exchange gains and
losses on monetary instruments and interest calculated using the effective interest method
are recognised in profi t or loss. The cumulative gain or loss previously recognised in other
comprehensive income is reclassifi ed from equity to profi t or loss as a reclassifi cation
adjustment when the fi nancial asset is derecognised.
Investments in equity instruments whose fair value cannot be reliably measured are
measured at cost less impairment loss.
Derecognition
A fi nancial asset is derecognised where the contractual right to receive cash fl ows from the
asset has expired. On derecognition of a fi nancial asset in its entirety, the difference between the
carrying amount and the sum of consideration received and any cumulative gain or loss that has
been recognised in other comprehensive income is recognised in profi t or loss.
Regular way purchases or sales of a fi nancial asset
All regular way purchases and sales of fi nancial assets are recognised or derecognised on the
trade date i.e., the date that the Group commits to purchase or sell the asset. Regular way
purchases or sales are purchases or sales of fi nancial assets that require delivery of assets within
the period generally established by regulation or convention in the marketplace concerned.
(b) Financial liabilities
Initial recognition and measurement
Financial liabilities are recognised when, and only when, the Group becomes a party to the
contractual provisions of the fi nancial instrument. The Group determines the classifi cation of its
fi nancial liabilities at initial recognition.
All fi nancial liabilities are recognised initially at fair value plus in the case of fi nancial liabilities not at
fair value through profi t or loss, directly attributable transaction costs.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201666
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.10 Financial Instruments (cont’d)
(b) Financial liabilities (cont’d)
Subsequent measurement
The measurement of fi nancial liabilities depends on their classifi cation as follows:-
(i) Financial liabilities at fair value through profi t or loss
Financial liabilities at fair value through profi t or loss include fi nancial liabilities held for
trading. Financial liabilities are classifi ed as held for trading if they are acquired for the
purpose of selling in the near term. This category includes derivative fi nancial instruments
entered into by the Group that are not designated as hedging instruments in hedge
relationships. Separated embedded derivatives are also classifi ed as held for trading unless
they are designated as effective hedging instruments.
Subsequent to initial recognition, fi nancial liabilities at fair value through profi t or loss are
measured at fair value. Any gains or losses arising from changes in fair value of the fi nancial
liabilities are recognised in profi t or loss.
(ii) Financial liabilities at amortised cost
After initial recognition, other fi nancial liabilities are subsequently measured at amortised
cost using the effective interest rate method. Gains and losses are recognised in profi t or
loss when the liabilities are derecognised, and through the amortisation process.
Derecognition
A fi nancial liability is derecognised when the obligation under the liability is discharged or cancelled
or expired. When an existing fi nancial liability is replaced by another from the same lender on
substantially different terms, or the terms of an existing liability are substantially modifi ed, such an
exchange or modifi cation is treated as a derecognition of the original liability and the recognition of
a new liability, and the difference in the respective carrying amounts is recognised in profi t or loss.
2.11 Impairment of fi nancial assets
The Group assesses at each end of the reporting period whether there is any objective evidence that a
fi nancial asset is impaired.
(a) Financial assets carried at amortised cost
For fi nancial assets carried at amortised cost, the Group fi rst assesses whether objective evidence
of impairment exists individually for fi nancial assets that are individually signifi cant, or collectively
for fi nancial assets that are not individually signifi cant. If the Group determines that no objective
evidence of impairment exists for an individually assessed fi nancial asset, whether signifi cant or
not, it includes the asset in a group of fi nancial assets with similar credit risk characteristics and
collectively assesses them for impairment. Assets that are individually assessed for impairment
and for which an impairment loss is, or continues to be recognised are not included in a collective
assessment of impairment.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 67
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.11 Impairment of fi nancial assets (cont’d)
(a) Financial assets carried at amortised cost (cont’d)
If there is objective evidence that an impairment loss on fi nancial assets carried at amortised cost
has been incurred, the amount of the loss is measured as the difference between the asset’s
carrying amount and the present value of estimated future cash fl ows discounted at the fi nancial
asset’s original effective interest rate. If a loan has a variable interest rate, the discount rate for
measuring any impairment loss is the current effective interest rate. The carrying amount of the
asset is reduced through the use of an allowance account. The impairment loss is recognised in
profi t or loss.
When the asset becomes uncollectible, the carrying amount of impaired fi nancial asset is reduced
directly or if an amount was charged to the allowance account, the amounts charged to the
allowance account are written off against the carrying value of the fi nancial asset.
To determine whether there is objective evidence that an impairment loss on fi nancial assets has
been incurred, the Group considers factors such as the probability of insolvency or signifi cant
fi nancial diffi culties of the debtor and default or signifi cant delay in payments.
If in a subsequent period, the amount of the impairment loss decreases and the decrease can
be related objectively to an event occurring after the impairment was recognised, the previously
recognised impairment loss is reversed to the extent that the carrying amount of the asset does
not exceed its amortised cost at the reversal date. The amount of reversal is recognised in profi t
or loss.
(b) Available-for-sale fi nancial assets
In the case of equity investments classifi ed as available-for-sale, objective evidence of impairment
include (i) signifi cant fi nancial diffi culty of the issuer or obligor, (ii) information about signifi cant
changes with an adverse effect that have taken place in the technological, market, economic or
legal environment in which the issuer operates, and indicates that the cost of the investment in
equity instrument may not be recovered; and (iii) a signifi cant or prolonged decline in the fair value
of the investment below its costs. “Signifi cant” is to be evaluated against the original cost of the
investment and ‘prolonged’ against the period in which the fair value has been below its original
cost.
If an available-for-sale fi nancial asset is impaired, an amount comprising the difference between
its acquisition cost (net of any principal repayment and amortisation) and its current fair value, less
any impairment loss previously recognised in profi t or loss is transferred from other comprehensive
income and recognised in profi t or loss. Reversals of impairment losses in respect of equity
instruments are not recognised in profi t or loss; increase in their fair value after impairment are
recognised directly in other comprehensive income.
2.12 Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, bank balances and short-term deposits in banks.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201668
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.13 Stocks
Stocks are stated at the lower of cost and net realisable value. Costs incurred in bringing the stocks
to their present location and condition are accounted at purchase costs on a fi rst-in fi rst-out basis for
trading stocks.
Where necessary, allowance is provided for damaged, obsolete and slow moving items to adjust the
carrying value of stocks to the lower of cost and net realisable value.
Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs
necessary to make the sale.
2.14 Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of
a past event, it is probable that an outfl ow of resources embodying economic benefi ts will be required to
settle the obligation and the amount of the obligation can be estimated reliably.
Provisions are reviewed at the end of each reporting period and adjusted to refl ect the current best
estimate. If it is no longer probable that an outfl ow of economic resources will be required to settle the
obligation, the provision is reversed. If the effect of the time value of money is material, provisions are
discounted using a current pre tax rate that refl ects, where appropriate, the risks specifi c to the liability.
When discounting is used, the increase in the provision due to the passage of time is recognised as a
fi nance cost.
2.15 Financial guarantee
A fi nancial guarantee contract is a contract that requires the issuer to make specifi ed payments to
reimburse the holder for a loss it incurs because a specifi ed debtor fails to make payment when due in
accordance with the terms of a debt instrument.
Financial guarantees are recognised initially as a liability at fair value, adjusted for transaction costs that
are directly attributable to the issuance of the guarantee. Subsequent to initial recognition, fi nancial
guarantees are recognised as income in profi t or loss over the period of the guarantee. If it is probable
that the liability will be higher than the amount initially recognised less amortisation, the liability is
recorded at the higher amount with the difference charged to profi t or loss.
2.16 Employee benefi ts
(a) Defi ned contribution plans
The Group participates in the national pension schemes as defi ned by the laws of the countries
in which it has operations. In particular, the Singapore and Hong Kong companies in the
Group make contributions to the Central Provident Fund (“CPF”) scheme in Singapore and the
Mandatory Provident Fund (“MBF”) scheme in Hong Kong, respectively which are defi ned
contribution pension schemes. Contributions to defi ned contribution pension schemes are
recognised as an expense in the period in which the related service is performed.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 69
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.16 Employee benefi ts (cont’d)
(b) Employee leave entitlement
Employee entitlements to annual leave are recognised as a liability when they are accrued to
employees. The estimated liability for leave is recognised for services rendered by employees up
to the end of the reporting period.
(c) Share-based payments
Employees (including senior executives) of the Group receive remuneration in the form of share-
based payments, whereby employees render services as consideration for equity instruments
(equity-settled transactions).
The cost of equity-settled transactions is determined by the fair value at the date when the grant
is made using an appropriate valuation model.
The cost is recognised, together with a corresponding increase in other capital reserves in equity,
over the period in which the performance and/ or service conditions are fulfi lled in employee
benefi ts expense. The cumulative expense recognised for equity-settled transactions at each
reporting date until the vesting date refl ects the extent to which the vesting period has expired
and the Group’s best estimate of the number of equity instruments that will ultimately vest. The
statement of profi t or loss expense or credit for a period represents the movement in cumulative
expense recognised as at the beginning and end of that period and is recognised in employee
benefi ts expense.
No expense is recognised for awards that do not ultimately vest, except for equity-settled
transactions for which vesting is conditional upon a market or non-vesting condition. These are
treated as vesting irrespective of whether or not the market or non-vesting condition is satisfi ed,
provided that all other performance and/ or service conditions are satisfi ed.
When the terms of an equity-settled award are modifi ed, the minimum expense recognised is
the expense had the terms had not been modifi ed, if the original terms of the award are met.
An additional expense is recognised for any modifi cation that increases the total fair value of the
share-based payment transaction, or is otherwise benefi cial to the employee as measured at the
date of modifi cation.
The dilutive effect of outstanding options is reflected as additional share dilution in the
computation of diluted earnings per share.
2.17 Borrowing costs
Borrowing costs are capitalised as part of the cost of a qualifying asset if they are directly attributable to
the acquisition, construction or production of that asset. Capitalisation of borrowing costs commences
when the activities to prepare the asset for its intended use or sale are in progress and the expenditures
and borrowing costs are incurred. Borrowing costs are capitalised until the assets are substantially
completed for their intended use or sale. All other borrowing costs are expensed in the period they
occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the
borrowing of funds.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201670
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.18 Leases
The determination of whether an arrangement is, or contains a lease is based on the substance of
the arrangement at inception date: whether fulfi lment of the arrangement is dependent on the use of
a specifi c asset or assets or the arrangement conveys a right to use the asset, even if that right is not
explicitly specifi ed in an arrangement.
For arrangements entered into prior to 1 January 2005, the date of inception is deemed to be 1 January
2005 in accordance with the transitional requirements of INT FRS 104.
As lessee
Finance leases, which transfer to the Group substantially all the risks and rewards incidental to
ownership of the leased item, are capitalised at the inception of the lease at the fair value of the leased
asset or, if lower, at the present value of the minimum lease payments. Any initial direct costs are also
added to the amount capitalised. Lease payments are apportioned between the fi nance charges and
reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the
liability. Finance charges are charged to profi t or loss. Contingent rents, if any, are charged as expenses
in the periods in which they are incurred.
Capitalised leased assets are depreciated over the shorter of the estimated useful life of the asset and
the lease term, if there is no reasonable certainty that the Group will obtain ownership by the end of the
lease term.
Operating lease payments are recognised as an expense in profi t or loss on a straight-line basis over the
lease term. The aggregate benefi t of incentives provided by the lessor is recognised as a reduction of
rental expense over the lease term on a straight-line basis.
2.19 Revenue
Revenue is recognised to the extent that is probable that the economic benefi ts will fl ow to the Group
and the revenue can be reliably measured, regardless of when the payment is made. Revenue is
measured at the fair value of consideration received or receivable, taking into account the amount of any
trade discounts and volume rebates allowed by the entity. The Group assesses its revenue arrangements
to determine if it is acting as principal or agent. The following specifi c recognition criteria must also be
met before revenue is recognised:-
(a) Sale of goods
Revenue from the sale of goods is recognised upon the transfer of signifi cant risk and rewards of
ownership of the goods to the customer, usually on delivery of goods. Revenue is not recognised
to the extent where there are signifi cant uncertainties regarding recovery of the consideration due,
associated costs or the possible return of goods.
(b) Commission income
Commission income is recognised as and when services are rendered.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 71
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.19 Revenue (cont’d)
(c) Interest income
Interest income is recognised using the effective interest method.
(d) Grant income
Grant income, pertaining to research and development activities, is recognised at their fair value
in profi t or loss as and when there is reasonable assurance that the grant will be received and all
attaching conditions will be complied with.
(e) Dividend income
Dividend income is recognised when the Group’s right to receive payment is established.
2.20 Taxes
(a) Current income tax
Current income tax assets and liabilities for the current and prior periods are measured at the
amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax
laws used to compute the amount are those that are enacted or substantively enacted at the end
of the reporting period, in the countries where the Group operates and generates taxable income.
Current income taxes are recognised in profi t or loss except to the extent that the tax relates to
items recognised outside profi t or loss, either in other comprehensive income or directly in equity.
Management periodically evaluates positions taken in the tax returns with respect to situations
in which applicable tax regulations are subject to interpretation and establishes provisions where
appropriate.
(b) Deferred tax
Deferred tax is provided using the liability method on temporary differences at the end of the
reporting period between the tax bases of assets and liabilities and their carrying amounts for
fi nancial reporting purposes.
Deferred tax liabilities are recognised for all temporary differences, except:-
– Where the deferred tax liability arises from the initial recognition of goodwill or of an asset
or liability in a transaction that is not a business combination and, at the time of the
transaction, affects neither the accounting profi t nor taxable profi t or loss; and
– In respect of taxable temporary differences associated with investments in subsidiaries,
associates and interests in joint ventures, where the timing of the reversal of the temporary
differences can be controlled and it is probable that the temporary differences will not
reverse in the foreseeable future.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201672
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.20 Taxes (cont’d)
(b) Deferred tax (cont’d)
Deferred tax assets are recognised for all deductible temporary differences, carry forward of
unused tax credits and unused tax losses, to the extent that it is probable that taxable profi t will
be available against which the deductible temporary differences, and the carry forward of unused
tax credits and unused tax losses can be utilised except:-
– Where the deferred tax asset relating to the deductible temporary difference arises from the
initial recognition of an asset or liability in a transaction that is not a business combination
and, at the time of the transaction, affects neither the accounting profi t nor taxable profi t or
loss; and
– In respect of deductible temporary differences associated with investments in subsidiaries,
associates and interests in joint ventures, deferred tax assets are recognised only to the
extent that it is probable that the temporary differences will reverse in the foreseeable future
and taxable profi t will be available against which the temporary differences can be utilised.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and
reduced to the extent that it is no longer probable that suffi cient taxable profi t will be available
to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax assets
are reassessed at the end of each reporting period and are recognised to the extent that it has
become probable that future taxable profi t will allow the deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the
year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that
have been enacted or substantively enacted at the end of each reporting period.
Deferred tax relating to items recognised outside profi t or loss is recognised outside profi t or
loss. Deferred tax items are recognised in correlation to the underlying transaction either in other
comprehensive income or directly in equity and deferred tax arising from a business combination
is adjusted against goodwill on acquisition.
Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set
off current income tax assets against current income tax liabilities and the deferred taxes relate to
the same taxable entity and the same taxation authority.
Tax benefi ts acquired as part of a business combination, but not satisfying the criteria for separate
recognition at that date, would be recognised subsequently if new information about facts and
circumstances changed. The adjustment would either be treated as a reduction to goodwill (as
long as it does not exceed goodwill) if it is incurred during the measurement period or in profi t or
loss.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 73
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.20 Taxes (cont’d)
(c) Sales tax
Revenues, expenses and assets are recognised net of the amount of sales tax except:-
– Where the sales tax incurred on a purchase of assets or services is not recoverable from
the taxation authority, in which case the sales tax is recognised as part of the cost of
acquisition of the asset or as part of the expense item as applicable; and
– Receivables and payables that are stated with the amount of sales tax included.
The net amount of sales tax recoverable from, or payable to, the taxation authority is included as
part of receivables or payables in the balance sheet.
2.21 Segment reporting
For management purposes, the Group is organised into operating segments based on geographical area
of the business unit which are independently managed by the respective segment managers responsible
for the performance of the respective segments under their charge. The segment managers report
directly to the management of the Company who regularly review the segment results in order to allocate
resources to the segments and to assess the segment performance. Additional disclosures on each of
these segments are shown in Note 32, including the factors used to identify the reportable segments
and the measurement basis of segment information.
2.22 Share capital and share issuance expenses
Proceeds from issuance of ordinary shares are recognised as share capital in equity. Incremental costs
directly attributable to the issuance of ordinary shares are deducted against share capital.
2.23 Treasury shares
The Group’s own equity instruments, which are reacquired (treasury shares) are recognised at cost
and deducted from equity. No gain or loss is recognised in profi t or loss on the purchase, sale, issue
or cancellation of the Group’s own equity instruments. Any difference between the carrying amount of
treasury shares and the consideration received, if reissued, is recognised directly in equity. Voting rights
related to treasury shares are nullifi ed for the Group and no dividends are allocated to them respectively.
2.24 Contingencies
A contingent liability is:-
(a) a possible obligation that arises from past events and whose existence will be confi rmed only by
the occurrence or non-occurrence of one or more uncertain future events not wholly within the
control of the Group; or
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201674
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
2. Summary of signifi cant accounting policies (cont’d)
2.24 Contingencies (cont’d)
A contingent liability is (cont’d):-
(b) a present obligation that arises from past events but is not recognised because:-
(i) It is not probable that an outfl ow of resources embodying economic benefi ts will be
required to settle the obligation; or
(ii) The amount of the obligation cannot be measured with suffi cient reliability.
A contingent asset is a possible asset that arises from past events and whose existence will be
confi rmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly
within the control of the Group.
Contingent liabilities and assets are not recognised on the balance sheet of the Group, except for
contingent liabilities assumed in a business combination that are present obligations and which the fair
values can be reliably determined.
2.25 Government grants
Government grants are recognised when there is reasonable assurance that the grant will be received
and all attaching conditions will be complied with.
3. Signifi cant accounting judgements and estimates
The preparation of the Group’s consolidated fi nancial statements requires management to make
judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets
and liabilities, and the disclosure of contingent liabilities at the end of each reporting period. However,
uncertainty about these assumptions and estimates could result in outcomes that require a material
adjustment to the carrying amount of the asset or liability affected in the future periods.
3.1 Judgements made in applying accounting policies
In the process of applying the Group’s accounting policies, management has made the following
judgements, apart from those involving estimations, which have the most signifi cant effect on the
amounts recognised in the consolidated fi nancial statements:-
Income taxes
The Group has exposure to income taxes in a number of jurisdictions. Signifi cant judgement is
involved in determining the Group-wide provision for income taxes. There are certain transactions
and computations for which the ultimate tax determination is uncertain during the ordinary course
of business. The Group recognises liabilities for expected tax issues based on estimates of whether
additional taxes will be due. Where the fi nal tax outcome of these matters is different from the amounts
that were initially recognised, such differences will impact the income tax and deferred tax provisions
in the period in which such determination is made. The carrying amount of the Group’s provision for
taxation and deferred tax assets at the balance sheet date was US$3,221,000 (2015: US$2,792,000)
and US$18,000 (2015: US$30,000) respectively.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 75
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
3. Signifi cant accounting judgements and estimates (cont’d)
3.2 Key sources of estimation uncertainty
The key assumptions concerning the future and other key sources of estimation uncertainty at the
end of the reporting period are discussed below. The Group based its assumptions and estimates
on parameters available when the financial statements were prepared. Existing circumstances
and assumptions about future developments, however, may change due to market changes or
circumstances arising beyond the control of the Group. Such changes are refl ected in the assumptions
when they occur.
(a) Impairment of loans and receivables
The Group assesses at the end of each reporting period whether there is any objective evidence
that a fi nancial asset is impaired. To determine whether there is objective evidence of impairment,
the Group considers factors such as the probability of insolvency or signifi cant fi nancial diffi culties
of the debtor and default or signifi cant delay in payments.
Where there is objective evidence of impairment, the amount and the timing of future cash fl ows
are estimated based on historical loss experience for assets with similar credit risk characteristics.
The carrying amount of the Group’s loans and receivables at the end of the reporting period is
disclosed in Notes 14, 15, and 18.
(b) Allowance for slow-moving and obsolete stocks
The Group carried out stocks review on a product-by-product basis to determine the allowance
for slow-moving stocks and whether stocks are stated at the lower of cost and net realisable
value. For the purpose of determining whether stocks are stated at the lower of cost and net
realisable value, management’s estimates of the net realisable value of the stocks at the end of
the reporting period are based primarily on the latest selling prices and the market conditions. The
Group’s allowances for stocks as at 31 December 2016 are disclosed in Note 16.
3.3 Change in accounting estimate
The Group reassessed the basis of estimating the allowances for slow-moving and obsolete stocks,
taking historical experience into consideration, and made a revision to the basis effective 1 January
2016. The change in the basis for making the estimate has the effect of lowering the allowance for slow-
moving and obsolete stocks by a net amount of US$186,000 for the current fi nancial year.
The effect of this change in accounting estimate on future periods has not been disclosed as estimating
the effect is impracticable.
4. Revenue
Group2016 2015
US$’000 US$’000
Sale of goods 988,208 828,229
Commission income 32 54
988,240 828,283
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201676
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
5. Other income
Group2016 2015
US$’000 US$’000
Other income includes:-
Interest income on bank deposits 26 34
Grant and subsidy income 204 115
Dividend income from investment securities 177 191
Unclaimed customer deposits – 264
Gain from the disposal of business activities in the research and
development division in 2014 100 –
6. Interest expense
Group2016 2015
US$’000 US$’000
Interest expense on:-
Bank loans and borrowings (2,472) (1,786)
7. Profi t before taxation
The following items have been included in arriving at profi t before tax:-
Group2016 2015
US$’000 US$’000
Net fair value loss on fi nancial instruments – (24)
Stocks recognised as an expense in cost of sales (Note 16) (931,877) (778,885)
Net stocks written down (Note 16) (93) (461)
Loss on disposal of property, plant and equipment (23) (2)
Depreciation of property, plant and equipment (Note 10) (755) (812)
Net foreign exchange loss (1,855) (1,201)
Other expenses:-
(Impairment) and reversal of impairment of fi nancial assets:-
- Allowance for doubtful trade debts (Note 14) (143) (1,655)
- Allowance for doubtful trade debts written back (Note 14) 973 585
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 77
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
7. Profi t before taxation (cont’d)
Group2016 2015
US$’000 US$’000
Employee benefi ts expenses (including directors):-
- Salaries and bonuses (24,759) (20,835)
- Contributions to CPF and other defi ned contribution pension schemes (3,346) (3,073)
- Other short term benefi ts (2,436) (1,491)
- Share-based payments (100) (70)
Audit fees paid to:-
- Auditors of the Company (210) (219)
- Other auditors (2) (17)
Non-audit fees paid to:-
- Auditors of the Company (17) (12)
- Other auditors (1) (1)
8. Income tax expense
(a) Major components of income tax expense
The major components of income tax expense for the fi nancial years ended 31 December are:-
Group2016 2015
US$’000 US$’000
Consolidated income statement
Current income tax
- Current year (1,426) (1,123)
- Underprovision in respect of previous years (13) (2)
Deferred income tax
- Origination and reversal of temporary differences (13) (19)
Income tax expense recognised in profi t or loss (1,452) (1,144)
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201678
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
8. Income tax expense (cont’d)
(b) Relationship between tax expense and accounting profi t
The reconciliation between tax expense and the product of accounting profi t multiplied by the
applicable tax rate for the fi nancial years ended 31 December is as follows:-
Group2016 2015
US$’000 US$’000
Profi t before taxation 8,505 5,499
Tax expense at statutory tax rate of 17% (2015: 17%) (1,446) (935)
Adjustments:-
Non-deductible expenses (477) (416)
Income not subject to taxation 174 35
Tax rebates and tax incentives 182 87
Difference in tax rates of overseas subsidiaries (3) 10
Underprovision in respect of previous years (13) (2)
Losses of foreign subsidiaries not available for set-off against
profi ts of other companies within the Group (56) (23)
Utilisation of prior years’ tax losses 171 99
Others 16 1
Income tax expense recognised in profi t or loss (1,452) (1,144)
A subsidiary has been granted a tax incentive under the Singapore Global Trader Programme
(“GTP”) for a period of 3 years from 1 January 2016 to 31 December 2018. The income relating to
the GTP qualifying activities is taxed at 10% while the income relating to the non-GTP activities is
taxed at the normal rate of 17%.
9. Earnings per share
Basic earnings per share are calculated by dividing profi t for the year attributable to equity holders of the
Company by the weighted average number of ordinary shares outstanding during the fi nancial year. The
following table refl ects the profi t and share data used in the computation of basic earnings per share for
the years ended 31 December:-
Group2016 2015
Profi t for the year attributable to equity holders of the Company used in
the computation of basic earnings per share (US$’000) 7,053 4,355
Weighted average number of ordinary shares, excluding treasury shares,
for basic earnings per share computation (’000) 105,999 102,214
As there were no share options and warrants granted, the basic and diluted earnings per share are the
same.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 79
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
10. Property, plant and equipment
Group
Furnitureand
fi ttingsOffi ce
equipmentMotor
vehicles Computers RenovationsLeasehold
building TotalUS$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000
Cost:-At 1 January 2015 600 2,963 1,892 2,204 1,704 353 9,716
Additions 24 69 20 195 56 4 368
Written off during the year (8) (93) – (54) (256) (2) (413)
Disposals (2) (24) – (39) – – (65)
Exchange differences – (1) 22 (21) (4) – (4)
At 31 December 2015 and
1 January 2016 614 2,914 1,934 2,285 1,500 355 9,602
Additions 153 105 382 390 571 – 1,601
Written off during the year – (1) – (42) – – (43)
Disposals (55) (170) (298) (11) (64) – (598)
Exchange differences – (2) – 2 (5) – (5)
At 31 December 2016 712 2,846 2,018 2,624 2,002 355 10,557
Accumulated depreciation:-At 1 January 2015 495 2,763 872 1,599 1,348 317 7,394
Depreciation charge for
the year 40 103 218 256 175 20 812
Written off during the year (8) (93) – (54) (256) (2) (413)
Disposals (2) (22) – (39) – – (63)
Exchange differences (1) (1) 6 (1) (1) – 2
At 31 December 2015 and
1 January 2016 524 2,750 1,096 1,761 1,266 335 7,732
Depreciation charge for
the year 36 83 207 255 161 13 755
Written off during the year – (1) – (42) – – (43)
Disposals (54) (152) (177) (10) (64) – (457)
Exchange differences – (3) – – (4) – (7)
At 31 December 2016 506 2,677 1,126 1,964 1,359 348 7,980
Net carrying amount:-At 31 December 2015 90 164 838 524 234 20 1,870
At 31 December 2016 206 169 892 660 643 7 2,577
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201680
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
11. Intangible assets
GroupClub
membershipsUS$’000
Cost:-At 1 January 2015, 31 December 2015 and 1 January 2016 347
Additions 193
At 31 December 2016 540
Accumulated impairment:-At 1 January 2015, 31 December 2015 and 31 December 2016 (21)
Net carrying amount:-At 31 December 2015 326
At 31 December 2016 519
12. Investments in subsidiaries
Company2016 2015
US$’000 US$’000
Unquoted shares, at cost 9,878 13,049
The subsidiaries as at 31 December are:-
NameCountry of
incorporationPrincipal activities(Place of business)
Unquoted equityshares, at cost
Proportion (%)of ownership
interest2016 2015 2016 2015
US$’000 US$’000 % %
Held by the Company
Excelpoint Systems (Pte) Ltd (1) Singapore Trading of electronic
components
(Singapore)
3,927 3,927 100 100
Excelpoint Systems (H.K.)
Limited (2)
Hong Kong Trading of electronic
components
(Hong Kong)
5,951 5,951 100 100
Lights Electronics Pte Ltd (6) Singapore Dormant – 3,171 100 100
PlanetSpark Pte. Ltd. (5) Singapore Dormant –* –* 100 100
9,878 13,049
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 81
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
12. Investments in subsidiaries (cont’d)
NameCountry of
incorporationPrincipal activities(Place of business)
Proportion (%)of ownership
interest2016 2015
% %
Held by Excelpoint Systems (Pte) Ltd
Excelpoint Systems Sdn. Bhd. (3) Malaysia Trading of electronic
components
(Malaysia)
100 100
Excelpoint Systems (India) Private Limited (2) India Provision of marketing
support services and
technical support
services
(India)
100 100
Held by Excelpoint Systems (H.K.) Limited
Excelpoint International Trading (Shanghai)
Co., Ltd. (2)
The People’s
Republic of
China
Trading of electronic
components
(The People’s
Republic of China)
100 100
Excelpoint International Trading (Shenzhen)
Co., Ltd. (4)
The People’s
Republic of
China
Dormant
(The People’s
Republic of China)
100 100
(1) Audited by Ernst & Young LLP, Singapore.
(2) Audited by member fi rm of EY Global in the respective countries.
(3) Audited by Yong & Leonard Chartered Accountants, Malaysia.
(4) Audited by Shenzhen Yida Certifi ed Public Accountants Co., Ltd, The People’s Republic of China.
(5) Not required to be audited by the laws of country of incorporation.
(6) This company was struck-off during the year and deregistration is expected to be completed by March 2017.
* The cost of investment is less than US$1,000.
13. Investment securities
Group and Company2016 2015
US$’000 US$’000
Available-for-sale fi nancial assets:-
- Equity instruments (quoted) 1,793 1,756
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201682
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
14. Trade debtors
Group Company2016 2015 2016 2015
US$’000 US$’000 US$’000 US$’000
Trade debtors 154,323 136,404 6 5
Less: Allowance for doubtful trade debts (87) (1,166) – –
154,236 135,238 6 5
Trade debtors are non-interest bearing and are generally on 30 to 90 days’ terms. They are recognised
at their original invoice amounts which represent their fair values on initial recognition.
Trade debtors denominated in foreign currencies at 31 December are as follows:-
Group Company2016 2015 2016 2015
US$’000 US$’000 US$’000 US$’000
Renminbi 17,617 15,973 – –
Singapore Dollar 780 332 6 5
India Rupee – 38 – –
Hong Kong Dollar 15 14 – –
Euro 86 13 – –
Trade debtors that are past due but not impaired
The Group has trade debtors amounting to US$38,696,000 (2015: US$35,577,000) that are past due
at the end of the reporting period but not impaired. These receivables are unsecured and the analysis of
their aging at the end of the reporting period is as follows:-
Group2016 2015
US$’000 US$’000
Trade debtors past due:-
Less than 30 days 22,026 24,766
31 to 60 days 9,075 5,594
61 to 90 days 2,408 3,478
More than 90 days 5,187 1,739
38,696 35,577
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 83
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
14. Trade debtors (cont’d)
Trade debtors that are impaired
The Group’s trade debtors that are impaired at the end of the reporting period and the movement of the
allowance accounts used to record the impairment are as follows:-
Group2016 2015
US$’000 US$’000
Trade debtors – nominal amounts 87 1,166
Less: Allowance for impairment (87) (1,166)
– –
Movement in allowance accounts:-
At 1 January (1,166) (106)
Charge for the fi nancial year (143) (1,655)
Allowance written back 973 585
Bad debts written off 248 6
Exchange differences 1 4
At 31 December (87) (1,166)
Trade debtors that are individually determined to be impaired at the end of the reporting period relate to
debtors that are in signifi cant fi nancial diffi culties and have defaulted on payments. These receivables are
not secured by any collateral or credit enhancements.
15. Other debtors
Group2016 2015
US$’000 US$’000
Deposits 795 808
Staff loans 10 12
Others 338 71
1,143 891
Staff loans are unsecured, non-interest bearing and have scheduled repayment dates repayable within 1
to 2 years (2015: 1 to 2 years).
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201684
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
15. Other debtors (cont’d)
Other debtors denominated in foreign currencies at 31 December are as follows:-
Group2016 2015
US$’000 US$’000
Singapore Dollar 117 140
Hong Kong Dollar 254 240
Renminbi 341 372
Indian Rupee 50 42
16. Stocks
Group2016 2015
US$’000 US$’000
Balance sheet:-
Trading stocks at lower of cost and net realisable value 131,598 111,613
Income statement:-
Stocks recognised as an expense in cost of sales (931,877) (778,885)
Stocks written down (2,793) (5,021)
Reversal of stocks written down 2,700 4,560
The reversal of stocks written down/ stocks recovered was made when the related stocks were sold
above their carrying amounts.
17. Amounts due from/ (to) subsidiaries
Company2016 2015
US$’000 US$’000
Amounts due from subsidiaries:-
Loans 26,551 18,759
Amounts due to subsidiaries:-
Non-trade – (78)
26,551 18,681
Amounts due from subsidiaries are repayable on demand, unsecured and are to be settled in cash.
Loans due from subsidiaries bear interest ranging from 1.29% to 2.02% (2015: 1.23% to 1.88%) per
annum.
Amounts due to subsidiaries are repayable on demand, unsecured and are to be settled in cash.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 85
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
18. Cash and short-term deposits
Group Company2016 2015 2016 2015
US$’000 US$’000 US$’000 US$’000
Cash at bank and on hand 15,020 9,261 2,841 881
Short-term deposits 1,586 1,463 – –
16,606 10,724 2,841 881
Cash at banks earns interest at fl oating rates based on daily bank deposit rates.
Short-term deposits are made for varying periods of between one day and one month depending on
the immediate cash requirements of the Group, and earn interests at the respective short-term deposit
rates. The weighted average effective interest rate for the fi nancial year for the Group was 1.10% (2015:
1.29%) per annum.
Cash and short-term deposits denominated in foreign currencies at 31 December are as follows:-
Group Company2016 2015 2016 2015
US$’000 US$’000 US$’000 US$’000
Singapore Dollar 4,117 647 2,549 83
Hong Kong Dollar 403 181 – –
Renminbi 4,843 2,845 – –
19. Trade creditors and accruals
Group Company2016 2015 2016 2015
US$’000 US$’000 US$’000 US$’000
Trade creditors (93,475) (89,247) – 4
Accruals (6,617) (3,841) (882) (453)
(100,092) (93,088) (882) (449)
Trade creditors and accruals are non-interest bearing and are normally settled on 30 to 90 days’ terms.
Trade creditors and accruals denominated in foreign currencies at 31 December are as follows:-
Group Company2016 2015 2016 2015
US$’000 US$’000 US$’000 US$’000
Euro (53) (368) – –
Renminbi (2,943) (2,621) – –
Indian Rupee (219) (287) – –
Singapore Dollar (3,077) (1,545) (882) (449)
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201686
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
20. Other creditors
Group Company2016 2015 2016 2015
US$’000 US$’000 US$’000 US$’000
Deposits received (6,599) (3,917) – –
Advances from suppliers (2,876) (3,670) – –
Sundries (4,296) (2,648) (18) (24)
(13,771) (10,235) (18) (24)
Other creditors are non-interest bearing and are normally settled on 30 to 90 days’ terms.
Sundries includes provisions for sales rebates, shipping and freight costs and miscellaneous costs.
Other creditors denominated in foreign currencies at 31 December are as follows:-
Group Company2016 2015 2016 2015
US$’000 US$’000 US$’000 US$’000
Singapore Dollar (375) (340) (14) (24)
Renminbi (1,870) (1,381) – –
Hong Kong Dollar (125) (113) – –
21. Interest-bearing loans and borrowings
Group2016 2015
US$’000 US$’000
Current:-
Bills payable, unsecured (120,501) (99,445)
Revolving short term loan (3,000) –
(123,501) (99,445)
Bills payable, unsecured
The Group’s bills payables bear interest ranging from 0.90% to 2.25% (2015: 0.90% to 2.00%) above
the banks’ cost of funds or interbank offer rates per annum.
Revolving short term loan
The Group’s revolving short term loan is unsecured and bears interest of 2.30% (2015: Nil) per annum.
The loan was repaid in January 2017.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 87
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
22. Deferred tax assets
Group2016 2015
US$’000 US$’000
At 1 January 30 49
Recognised for the fi nancial year (Note 8) (11) (16)
Exchange differences (Note 8) (2) (3)
At 31 December 18 30
Deferred tax assets recognised are as follows:-
Differences in depreciation (81) (30)
Provision for employee leave entitlement 78 42
Others 21 18
Net deferred tax assets recognised 18 30
Unrecognised tax losses
As at 31 December 2016, the Group has unutilised tax losses amounting to US$1,756,000 (2015:
US$2,455,000). Deferred tax benefi t on unutilised tax losses of US$299,000 (2015: US$470,000) has
not been recognised due to the unpredictability of future income.
23. Share capital
Group and Company2016 2015
No. of shares US$’000 No. of shares US$’000
‘000 ‘000
Issued and fully paid ordinary shares:-
At 1 January 102,423 32,410 510,022 32,294
Grant of EPSS share awards – – 598 46
Total shares before consolidation 102,423 32,410 510,620 32,340
Shares consolidation – – (408,496) –
Grant of EPSS share awards 388 100 299 70
Issuance of new shares 15,000 5,734 – –
At 31 December 117,811 38,244 102,423 32,410
The holders of ordinary shares are entitled to receive dividends as and when declared by the Company.
All ordinary shares carry one vote per share without restrictions. The ordinary shares have no par value.
On 11 August 2015, the Company completed the consolidation of every fi ve existing issued shares in
the capital of the Company into one ordinary share in the capital of the Company. As a result of the
exercise, the total issued share capital of the Company comprises 102,124,040 consolidated shares.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201688
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
23. Share capital (cont’d)
On 5 October 2016, the Company completed the 15,000,000 private share placement of the Company’s
ordinary share, which were allotted and issued to the Placee at a price of US$0.385 (S$0.525) per
Subscription Share, net of incremental costs directly attributable to the issuance of ordinary shares.
Grant of Share Awards Pursuant to the Excelpoint Performance Share Scheme (“EPSS”)
In May 2015, the Company issued and allotted 598,000 ordinary shares in the share capital of the
Company at the Market Price of US$0.073 (S$0.100) under the EPSS.
In November 2015, the Company issued and allotted 299,400 ordinary shares in the share capital of the
Company at the Market Price of US$0.236 (S$0.330) under the EPSS.
In February 2016, the Company issued and allotted 60,000 ordinary shares in the share capital of the
Company at the Market Price of US$0.200 (S$0.280) under the EPSS.
In November 2016, the Company issued and allotted 327,500 ordinary shares in the share capital of the
Company at the Market Price of US$0.269 (S$0.375) under the EPSS.
24. Other reserves
(a) Statutory reserve fund
In accordance with the Foreign Enterprise Law applicable to the subsidiaries in the People’s
Republic of China (“PRC”), a subsidiary is required to make appropriation to a Statutory Reserve
Fund (“SRF”). At least 10% of the statutory after tax profi ts as determined in accordance with
the applicable PRC accounting standards and regulations must be allocated to the SRF until the
cumulative total of the SRF reaches 50% of the subsidiary’s registered capital. Subject to approval
from the relevant PRC authorities, the SRF may be used to offset any accumulated losses or
increase the registered capital of the subsidiary. The SRF is not available for dividend distribution
to shareholders.
(b) Foreign currency translation reserve
The foreign currency translation reserve represents exchange differences arising from the
translation of the fi nancial statements of foreign operations whose functional currencies are
different from that of the Group’s presentation currency.
(c) Fair value reserve
Fair value reserve represents the cumulative fair value changes, net of tax, of available-for-sale
fi nancial assets until they are disposed of or impaired.
(d) Other capital reserve - Gain or loss on reissuance of treasury shares
This represents the gain or loss arising from purchase, sale, issue or cancellation of treasury
shares. No dividend may be paid, and no other distribution (whether in cash or otherwise) of
the Company’s assets (including any distribution of assets to members on a winding up) may be
made in respect of this reserve.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 89
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
25. Related party transactions
(a) Sale and purchase of goods and services
In addition to the related party information disclosed elsewhere in the fi nancial statements, the
following signifi cant transactions between the Group and related parties took place at terms
agreed between the parties during the fi nancial year:-
Group2016 2015
US$’000 US$’000
Rental expense paid to a director 109 124
(b) Compensation of key management personnel
Group2016 2015
US$’000 US$’000
Short-term employee benefi ts 4,330 4,200
Contributions to CPF and other defi ned contribution pension
schemes 93 58
Directors’ fee 147 144
Share based payments 25 51
4,595 4,453
Comprise amounts paid to:-
Directors of the Company 3,174 2,931
Other key management personnel 1,421 1,522
4,595 4,453
26. Commitments and contingencies
(a) Operating lease commitments – as lessee
The Group leases certain properties under lease arrangements that are non-cancellable. The
leases have an average tenure of between two months and three years with renewal options and
escalation clauses included in the contracts. There are no restrictions placed upon the Group
by entering into these leases. Operating lease payments recognised in profi t or loss during the
fi nancial year ended 31 December 2016 amounted to US$3,362,000 (2015: US$3,109,000).
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201690
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
26. Commitments and contingencies (cont’d)
(a) Operating lease commitments – as lessee (cont’d)
Future minimum rental payable under non-cancellable operating leases as at 31 December are as
follows:-
Group2016 2015
US$’000 US$’000
Not later than one year 3,124 2,432
Later than one year but not later than three years 2,828 1,982
Later than three years – 6
5,952 4,420
(b) Guarantees
As at 31 December 2016, the Company has provided corporate guarantees to banks
and institutions in connection with credit facilities provided to its subsidiaries, of which
US$126,385,000 (2015: US$105,244,000) of the credit facilities have been utilised as at year end.
27. Financial risk management objectives and policies
The Group and the Company are exposed to fi nancial risks arising from its operations and the use of
fi nancial instruments. The key fi nancial risks include credit risk, liquidity risk, interest rate risk and foreign
currency risk. It is, and has been throughout the current and previous fi nancial years, the Group’s policy
that no trading in derivatives for speculative purposes shall be undertaken.
The following sections provide details regarding the Group’s and the Company’s exposure to the above-
mentioned fi nancial risks and the objectives, policies and processes for the management of these risks.
There has been no change to the Group’s and the Company’s exposure to these fi nancial risks or the
manner in which it manages and measures the risks.
(a) Credit risk
Credit risk is the risk of loss that may arise on outstanding fi nancial instruments should a
counterparty default on its obligations. The Group’s exposure to credit risk arises primarily from
trade and other debtors. For other fi nancial assets (including investment securities and cash and
short-term deposits), the Group and the Company manage credit risk by dealing exclusively with
high credit rating counterparties.
The Group’s objective is to seek continual revenue growth while minimising losses incurred due
to increased credit risk exposure. The Group trades only with recognised and creditworthy third
parties. It is the Group’s policy that all customers who wish to trade on credit terms are subject to
credit verifi cation procedures. In addition, debtor balances are monitored on an ongoing basis and
appropriate measures to mitigate credit risk exposures are undertaken to ensure that the Group’s
exposure to bad debts is not signifi cant.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 91
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
27. Financial risk management objectives and policies (cont’d)
(a) Credit risk (cont’d)
At the end of the reporting period, the Group’s and the Company’s maximum exposure to
credit risk is represented by the carrying amount of each class of fi nancial assets recognised in
the balance sheets and an amount of US$126,385,000 (2015: US$105,244,000) relating to the
corporate guarantees provided by the Company to various banks on its subsidiaries’ bank loans.
Credit risk concentration profi le
The Group determines concentrations of credit risk by monitoring the country profi le of its trade
debtors on an ongoing basis. The credit risk concentration profi le of the Group’s trade debtors at
the end of the reporting period is as follows:-
Group2016 2015
US$’000 % of total US$’000 % of total
Hong Kong/ The People’s Republic
of China 117,404 76.1 107,601 79.6
Singapore 11,312 7.3 10,286 7.6
India 6,621 4.3 6,765 5.0
Malaysia 6,880 4.5 4,147 3.1
Thailand 1,890 1.1 817 0.6
Philippines 2,747 1.8 391 0.3
Indonesia 294 0.2 2,220 1.6
Australia 1,284 0.8 564 0.4
United States 1,854 1.2 1,696 1.3
Others 3,950 2.7 751 0.5
154,236 100.0 135,238 100.0
At the end of the reporting period, approximately 13% (2015: 12%) of the Group’s trade
receivables were due from 2 major customers located in Singapore and Hong Kong/ The People’s
Republic of China (2015: Singapore and Hong Kong/ The People’s Republic of China).
Financial assets that are neither past due nor impaired
Trade and other debtors that are neither past due nor impaired are with creditworthy debtors with
good payment record with the Group. Investment securities, and cash and short-term deposits
that are neither past due nor impaired are placed with or entered into with reputable fi nancial
institutions or companies with high credit ratings and no history of default.
Financial assets that are either past due or impaired
Information regarding fi nancial assets that are either past due or impaired is disclosed in Note 14.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201692
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
27. Financial risk management objectives and policies (cont’d)
(b) Liquidity risk
Liquidity risk is the risk that the Group or the Company will encounter diffi culty in meeting fi nancial
obligations due to shortage of funds. The Group’s and the Company’s exposure to liquidity risk
arises primarily from mismatches of the maturities of fi nancial assets and liabilities. The Group’s
and the Company’s objective is to maintain a balance between continuity of funding and fl exibility
through the use of stand-by credit facilities.
The Group monitors its liquidity risk and maintains adequate liquid fi nancial assets and stand-by
credit facilities with different banks to fi nance the Group’s operations and to mitigate the effects of
fl uctuations in cash fl ows.
Analysis of fi nancial instruments by the remaining contractual maturities
The maturity profi le of the Group’s and the Company’s fi nancial assets and fi nancial liabilities at the
end of the reporting period based on the contractual undiscounted repayment obligations are less
than one year.
The maturity profi le of the Group’s contingent liabilities and commitments are less than one year.
(c) Interest rate risk
Interest rate risk is the risk that the fair value or future cash fl ows of the Group’s and the
Company’s fi nancial instruments will fl uctuate because of changes in market interest rates.
The Group’s exposure to interest rate risk arises primarily from their interest-bearing loans and
borrowings. All of the Group’s and the Company’s fi nancial assets and liabilities at fl oating rates
are contractually re-priced at intervals of less than 6 months (2015: less than 6 months) from the
end of the reporting period.
The Group’s policy is to obtain the most favourable interest rates available without increasing its
foreign currency exposure. Surplus funds are placed with reputable banks.
Sensitivity analysis for interest rate risk
At the end of the reporting period, if USD interest rates had been 100 (2015: 100) basis points
lower/ higher with all other variables held constant, the Group’s profi t after taxation would have
been US$102,000 (2015: US$110,000) higher/ lower, arising mainly as a result of lower/ higher
interest expense on fl oating rate loans and borrowings. The assumed movement in basis points
for interest rate sensitivity analysis is based on the currently observable market environment.
(d) Foreign currency risk
The Group has transactional currency exposures arising from sales or purchases that are
denominated in a currency other than the respective functional currencies of Group entities,
primarily USD. The foreign currencies in which these transactions are denominated are mainly in
Singapore Dollars (“SGD”), Hong Kong Dollars (“HKD”), Renminbi (“RMB”), and Europe currency
(“Euro”).
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 93
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
27. Financial risk management objectives and policies (cont’d)
(d) Foreign currency risk (cont’d)
Sensitivity analysis for foreign currency risk
The following table demonstrates the sensitivity of the Group’s profi t before taxation to a
reasonably possible change in the SGD, HKD, RMB, and Euro exchange rates (against USD), with
all other variables held constant:-
Group2016 2015
US$’000 US$’000
SGD - strengthened 5% (2015: 5%) 78 (38)
SGD - weakened 5% (2015: 5%) (78) 38
HKD - strengthened 5% (2015: 5%) 22 11
HKD - weakened 5% (2015: 5%) (22) (11)
RMB - strengthened 5% (2015: 5%) 899 759
RMB - weakened 5% (2015: 5%) (899) (759)
Euro - strengthened 5% (2015: 5%) 4 (17)
Euro - weakened 5% (2015: 5%) (4) 17
28. Loans and receivables
Group Company2016 2015 2016 2015
US$’000 US$’000 US$’000 US$’000
Trade debtors (Note 14) 154,236 135,238 6 5
Other debtors (Note 15) 1,143 891 – –
Amounts due from subsidiaries (Note 17) – – 26,551 18,759
Cash and short-term deposits (Note 18) 16,606 10,724 2,841 881
Total loans and receivables 171,985 146,853 29,398 19,645
29. Financial liabilities
Group Company2016 2015 2016 2015
US$’000 US$’000 US$’000 US$’000
Trade creditors and accruals (Note 19) (100,092) (93,088) (882) (449)
Other creditors (Note 20) (7,172) (6,318) (18) (24)
Interest-bearing loans and borrowings
(Note 21) (123,501) (99,445) – –
Amounts due to subsidiaries (Note 17) – – – (78)
Total fi nancial liabilities carried at amortised
cost (230,765) (198,851) (900) (551)
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201694
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
30. Fair value of assets and liabilities
Fair value hierarchy
The Group classifi es fair value measurement using a fair value hierarchy that refl ects the signifi cance of
the inputs used in making the measurements. The fair value hierarchy has the following levels:-
– Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities that the
Group can assess at the measurement date;
– Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset
or liability, either directly or indirectly; and
– Level 3 – Inputs for the asset or liability that are not based on observable market data
(unobservable inputs).
Fair value measurements that use inputs of different hierarchy levels are categorised in its entirety in
the same level of the fair value hierarchy as the lowest level input that is signifi cant to the entire
measurement.
(a) Assets and liabilities measured at fair value
The following table shows an analysis of each class of assets and liabilities measured at fair value
at the end of the reporting period:-
Quoted prices in active markets for identical
instruments(Level 1)
2016 2015US$’000 US$’000
Financial assetsAvailable for sale fi nancial assets
Quoted instrument securities (Note 13) 1,793 1,756
Determination of fair value
Quoted investment securities (Note 13): Fair value is determined by direct reference to their bid
price quotations in an active market at the end of the reporting period.
(b) Fair value of fi nancial instruments by classes that are not carried at fair value and
whose carrying amounts are reasonable approximation of fair value
Cash and short-term deposits, current trade and other debtors, current trade and other creditors
and accruals, and current interest-bearing loans and borrowings at fl oating rates.
The carrying amounts of these fi nancial assets and liabilities are reasonable approximation of fair
values, either due to their short-term nature or that they are fl oating rate instruments that are re-
priced to market interest rates on or near the end of the reporting period.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 95
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
31. Capital management
Capital includes debt and equity items as discussed in the table below.
The primary objective of the Group’s capital management is to ensure that it maintains a healthy capital
ratios in order to support its business and maximise shareholder value.
The Group manages its capital structure and makes adjustments to it, in light of changes in economic
conditions. To maintain or adjust the capital structure, the Group may adjust the dividend payment
to shareholders, return capital to shareholders or issue new shares. No changes were made in the
objectives, policies or processes during the fi nancial years ended 31 December 2016 and 2015.
As disclosed in Note 24(a), subsidiaries in PRC are required by the Foreign Enterprise Law of the PRC
to contribute to and maintain a non-distributable statutory reserve fund whose utilisation is subject to
approval by relevant PRC authorities. This externally imposed capital requirement has been complied
with by the above-mentioned subsidiary for the fi nancial years ended 31 December 2016 and 2015.
The Group monitors capital using a gearing ratio, which is net debt over total capital plus net debt.
The Group’s policy is to maintain a healthy gearing ratio. The Group includes within net debt, interest-
bearing loans and borrowings, less cash and short-term deposits. Capital includes equity attributable to
the equity holders of the Company less statutory reserve fund.
Group2016 2015
US$’000 US$’000
Interest-bearing loans and borrowings (Note 21) 123,501 99,445
Less: Cash and short-term deposits (Note 18) (16,606) (10,724)
Net debt 106,895 88,721
Equity attributable to equity holders of the Company 68,258 57,183
Less: Statutory reserve fund (Note 24(a)) (25) (25)
Total capital 68,233 57,158
Capital and net debt 175,128 145,879
Gearing ratio 61% 61%
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201696
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
32. Segment information
For management purposes, the Group is organised into business units based on geographical area, and
has three reportable operating segments as follows:-
(i) Hong Kong Business Unit
The Hong Kong Business Unit segment provides design-in and distribution services. This segment
covers the business entities located in Hong Kong and The People’s Republic of China.
(ii) Singapore Business Unit
The Singapore Business Unit segment provides design-in and distribution services. This segment
covers the business entities located in Southeast Asia and India.
(iii) Corporate Unit
The Corporate Unit segment comprises the corporate services, treasury functions, investment
securities, and other dormant companies.
Design-in services relate to product sales that include fi eld application services and design and
development services which require a higher level of technical expertise and involve research and
development.
Distribution services include value-added distribution and supply chain management which primarily
involve the provision of electronic components and related logistics to customers.
Except as indicated above, no operating segments have been aggregated to form the above operating
segments.
Management monitors the operating results of its business units separately for the purpose of making
decisions about resource allocation and performance assessment. Segment performance is evaluated
based on operating profi t or loss which in certain respects, as explained in the table below, is measured
differently from operating profi t or loss in the consolidated fi nancial statements.
Transfer prices between operating segments are on an arm’s length basis in a manner similar to
transactions with third parties.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 97
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
32. Segment information (cont’d)
The following table presents segment information regarding the Group’s geographical segments for the
years ended 31 December 2016 and 2015.
Hong KongBusiness Unit
SingaporeBusiness Unit Corporate Unit
Adjustment and eliminations
Per consolidated fi nancial
statements2016 2015 2016 2015 2016 2015 2016 2015 2016 2015
US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000
Revenue
External customers 551,086 492,345 437,154 335,938 – – – – 988,240 828,283
Inter-segment 922 1,291 47,886 37,341 – – (48,808) (38,632) – –
Total revenue 552,008 493,636 485,040 373,279 – – (48,808) (38,632) 988,240 828,283
Results
Interest income 21 25 4 8 1 1 – – 26 34
Loss on disposal of
property, plant and
equipment (23) (2) – – – – – – (23) (2)
Depreciation of
property, plant and
equipment (390) (429) (365) (383) – – – – (755) (812)
Other non-cash
expenses:-
- Reversal of stocks
written down 911 2,281 1,709 2,279 – – – – 2,700 4,560
- Stocks written down (1,297) (2,293) (1,496) (2,728) – – – – (2,793) (5,021)
- Allowance for
doubtful trade debts
written back 858 122 115 463 – – – – 973 585
- Allowance for
doubtful trade debts (40) (1,163) (103) (492) – – – – (143) (1,655)
Income tax expenses (739) (894) (695) (245) (18) (5) – – (1,452) (1,144)
Segment profi t before
tax 4,036 4,124 4,415 1,146 – 214 (169) 15 8,505 5,499
Assets
Additions to non-current
assets 979 194 815 174 – – – – 1,794 368
Segment assets 187,406 171,577 116,796 88,523 4,641 2,643 – – 308,843 262,743
Segment liabilities 129,876 114,043 109,792 91,030 917 487 – – 240,585 205,560
The nature of the adjustments and eliminations to arrive at amounts reported in the consolidated
fi nancial statements relates to inter-segment revenues that are eliminated on consolidation.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 201698
NOTES TO THEFINANCIAL STATEMENTSFor the fi nancial year ended 31 December 2016
32. Segment information (cont’d)
Geographical information
Revenue and non-current assets information based on the geographical location of customers and
assets respectively are as follows:-
Revenue Non-current assets2016 2015 2016 2015
US$’000 US$’000 US$’000 US$’000
Hong Kong/ The People’s Republic of China 757,768 624,660 1,601 1,152
Southeast Asia 181,549 157,447 1,345 984
India 27,284 26,318 150 60
Others 21,639 19,858 – –
988,240 828,283 3,096 2,196
Non-current assets information presented above consist of property, plant and equipment and intangible
assets as presented in the consolidated balance sheet.
Information about a major customer
There is no major customer for the years ended 31 December 2016 and 2015, contributing more than
10% of the total Group revenue.
33. Dividends
Group and Company2016 2015
US$’000 US$’000
Declared and paid during the fi nancial year:-
Dividends on ordinary shares:-
- Final exempt (one-tier) dividend for 2015: S$0.025
(2014: S$0.005) per share 1,906 1,926
- Final exempt (one-tier) special dividend for 2015: Nil
(2014: S$0.003) per share – 1,155
1,906 3,081
Proposed but not recognised as a liability as at 31 December:-
Dividends on ordinary shares subject to shareholders’ approval
at the AGM:-
- Final exempt (one-tier) dividend for 2016: S$0.025
(2015: S$0.025) per share 2,066 1,811
- Final exempt (one-tier) special dividend for 2016: S$0.015
(2015: Nil) per share 1,239 –
3,305 1,811
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 99
NOTES TO THEFINANCIAL STATEMENTS
For the fi nancial year ended 31 December 2016
34. Comparatives
“Net stock written down” of US$461,000 was reclassifi ed from “Other expenses” to “Cost of sales” to
conform to current year’s presentation and to better present the nature of the transactions:-
2015As
currently reported
2015As
previously reported
Increase/ (decrease)
US$’000 US$’000 US$’000
Consolidated income statementCost of sales 780,541 780,080 461
Other expenses 1,103 1,564 (461)
35. Authorisation of fi nancial statements for issue
The fi nancial statements for the fi nancial year ended 31 December 2016 were authorised for issue in
accordance with a resolution of the directors on 28 February 2017.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016100
STATISTICS OFSHAREHOLDINGSAs at 28 February 2017
Number of Issued Shares : 117,810,940
Class of Shares : Ordinary
Voting Rights : One vote per share
There are no treasury shares held by the Company.
DISTRIBUTION OF SHAREHOLDINGS
Size of ShareholdingsNumber of
Shareholders %Number of
Shares %
1 – 99 6 0.29 271 0.00
100 – 1,000 557 26.69 263,420 0.23
1,001 – 10,000 1,084 51.94 4,771,560 4.05
10,001 – 1,000,000 430 20.60 23,093,933 19.60
1,000,001 and above 10 0.48 89,681,756 76.12
Total 2,087 100.00 117,810,940 100.00
SUBSTANTIAL SHAREHOLDERS
Direct Interest % Deemed Interest %
Albert Phuay Yong Hen 47,915,204(1) 40.67 2,598,168(2) 2.21
Alonim Investments Inc 15,000,000 12.73 – –
Alan Kwan Wai Loen 6,258,244 5.31 – –
Notes:-
(1) Includes 400,000 shares held by Maybank Kim Eng Securities Pte. Ltd.
(2) Deemed to be interested as follows:-
(i) 166,000 shares held by AP21 Holdings Pte. Ltd.; and
(ii) 2,432,168 shares held by his spouse.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 101
STATISTICS OFSHAREHOLDINGS
As at 28 February 2017
TWENTY LARGEST SHAREHOLDERS
No. Name No. of Shares %
1 PHUAY YONG HEN 47,515,204 40.33
2 RAFFLES NOMINEES (PTE) LIMITED 15,237,780 12.93
3 KWAN WAI LOEN 6,258,244 5.31
4 CHNG SENG CHYE @ CHNG HUNG SENG 5,088,620 4.32
5 ANSWER TECHNOLOGY CO LTD 4,800,000 4.07
6 CITIBANK NOMINEES SINGAPORE PTE LTD 3,111,000 2.64
7 OCBC SECURITIES PRIVATE LIMITED 2,542,840 2.16
8 HAN JIAK SIEW 2,432,168 2.06
9 UOB KAY HIAN PRIVATE LIMITED 1,390,800 1.18
10 BRUCE DOUGLAS MOULIN 1,305,100 1.11
11 MAYBANK NOMINEES (SINGAPORE) PRIVATE LIMITED 728,600 0.62
12 MAYBANK KIM ENG SECURITIES PTE. LTD. 588,500 0.50
13 KOK FAT KEUNG 515,924 0.44
14 TEO YOU XIAO 506,000 0.43
15 PHILLIP SECURITIES PTE LTD 457,600 0.39
16 DBS NOMINEES (PRIVATE) LIMITED 399,080 0.34
17 LEE JUI-SI 390,000 0.33
18 LIM TECK HENG @ SOH TECK HENG STUART 386,000 0.33
19 CIMB SECURITIES (SINGAPORE) PTE. LTD. 363,660 0.31
20 OCBC NOMINEES SINGAPORE PRIVATE LIMITED 357,000 0.30
TOTAL 94,374,120 80.10
PERCENTAGE OF SHAREHOLDING IN PUBLIC’S HANDS
Based on the information provided, to the best of the Directors and substantial shareholders of the Company,
38.21% of the Company’s shares are held in the hands of the public as at 28 February 2017. Accordingly, the
Company has complied with Rule 723 of the Listing Manual of the SGX-ST.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016102
NOTICE OF SIXTEENTHANNUAL GENERAL MEETING
NOTICE IS HEREBY GIVEN that the Sixteenth Annual General Meeting of Excelpoint Technology Ltd. (“the
Company”) will be held at Grand Mercure Roxy Singapore, 50 East Coast Road, Roxy Square, Meyer & Frankel
Room, Level 3, Singapore 428769 on Wednesday, 5 April 2017 at 3.00 p.m. for the following purposes:
AS ORDINARY BUSINESS
1. To receive and adopt the Directors’ Statement and the Audited Financial Statements of the Company for
the year ended 31 December 2016 together with the Auditors’ Report thereon. (Resolution 1)
2. To declare a fi rst and fi nal ordinary tax exempt one-tier dividend of 2.5 Singapore cents per ordinary
share for the year ended 31 December 2016 (FY2015: First and fi nal ordinary tax exempt one-tier
dividend of 2.5 Singapore cents per ordinary share). (Resolution 2)
3. To declare a special tax exempt one-tier dividend of 1.5 Singapore cents per ordinary share for the year
ended 31 December 2016 (FY2015: Nil). (Resolution 3)
4. To re-elect the following Directors of the Company retiring pursuant to Article 104 of the Constitution of
the Company:
Sunny Wong Fook Choy (Resolution 4)
Alan Kwan Wai Loen (Resolution 5)
Mr Sunny Wong Fook Choy will, upon re-election as Director of the Company, remain as Chairman of
the Remuneration Committee and a member of the Audit Committee and Nominating Committee and
will be considered independent.
5. To re-elect the following Directors of the Company retiring pursuant to Article 108 of the Constitution of
the Company:
Herbert Kwok Fei Lung (Resolution 6)
Tonny Phuay Yong Choon (Resolution 7)
Joanne Khoo Su Nee (Resolution 8)
Ms Joanne Khoo Su Nee will, upon re-election as Director of the Company, remain as a member of the
Audit Committee and will be considered independent.
6. To approve the payment of Director’s Fee of S$13,013.70 in cash to an Independent Director for the
fi nancial year ended 31 December 2016.
[See Explanatory Note (i)] (Resolution 9)
7. To approve the payment of Directors’ Fees to the Independent Directors for the fi nancial year from 1
January 2017 to 31 December 2017 comprising:
(a) The payment of S$248,000 in cash (FY2016: Cash payment of S$198,000); and
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 103
NOTICE OF SIXTEENTHANNUAL GENERAL MEETING
(b) The award of an aggregate number of 80,000 ordinary shares in the capital of the Company
to the Independent Directors under the Excelpoint Performance Share Scheme as part of their
respective remuneration for the fi nancial year from 1 January 2017 to 31 December 2017
as follows (FY2016: Aggregate number of 60,000 ordinary shares in the share capital of the
Company pursuant to Excelpoint Performance Share Scheme):
(i) 20,000 ordinary shares to Kwah Thiam Hock;
(ii) 20,000 ordinary shares to Sunny Wong Fook Choy;
(iii) 20,000 ordinary shares to Professor Low Teck Seng; and
(iv) 20,000 ordinary shares to Joanne Khoo Su Nee.
[See Explanatory Note (ii)] (Resolution 10)
8. To re-appoint Messrs Ernst & Young LLP as the Auditors of the Company and to authorise the Directors
of the Company to fi x their remuneration. (Resolution 11)
9. To transact any other ordinary business which may properly be transacted at an Annual General Meeting.
AS SPECIAL BUSINESS
To consider and if thought fi t, to pass the following resolutions as Ordinary Resolutions, with or without any
modifi cations:
10. Authority to issue shares in the share capital of the Company
That pursuant to Section 161 of the Companies Act, Chapter 50 and Rule 806 of the Listing Manual
of the Singapore Exchange Securities Trading Limited (“SGX-ST”), the Directors of the Company be
authorised and empowered to:
(i) Issue shares in capital of the Company (whether by way of rights, bonus or otherwise); and/ or
(ii) Make or grant offers, agreements or options (collectively, “Instruments”) that might or would
require shares to be issued, including but not limited to the creation and issue of (as well as
adjustments to) options, warrants, debentures or other instruments convertible or exchangeable
into shares; and/ or
(iii) (Notwithstanding the authority conferred by this Ordinary Resolution may have ceased to be in
force) issue shares in pursuance of any Instruments made or granted by the Directors of the
Company while this Ordinary Resolution was in force,
provided that:
(a) The aggregate number of shares to be issued pursuant to the Ordinary Resolution (including
shares to be issued in pursuance of the Instruments made or granted pursuant to the Ordinary
Resolution and including shares which may be issued pursuant to any adjustment effected under
any relevant Instruments) shall not exceed fi fty per centum (50%) (or such other limit or limits
and manner of calculation as may be prescribed by the Singapore Exchange Securities Trading
Limited) of the total number of issued shares (excluding treasury shares) in the capital of the
Company of which the aggregate number of shares and convertible securities issued other than
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016104
NOTICE OF SIXTEENTHANNUAL GENERAL MEETING
on a pro-rata basis to existing shareholders shall not exceed twenty per centum (20%) (or such
other limit or limits and manner of calculation as may be prescribed by the Singapore Exchange
Securities Trading Limited) of the total number of issued shares (excluding treasury shares) in the
capital of the Company;
(b) For the purpose of determining the aggregate number of shares that may be issued under sub-
paragraph (a) above, the total number of issued shares (excluding treasury shares) shall be based
on the total number of issued shares (excluding treasury shares) in the capital of the Company at
the time of the passing of this Ordinary Resolution, after adjusting for:
(i) New shares arising from the conversion or exercise of convertible securities or employee
share options on issue as at the date of the passing of the Ordinary Resolution; and
(ii) Any subsequent consolidation or sub-division of shares.
(c) In exercising the power to make or grant Instruments (including the making of any adjustment
under any relevant Instrument), the Company shall comply with the listing rules and regulations
of the Singapore Exchange Securities Trading Limited for the time being in force (unless such
compliance has been waived by the Singapore Exchange Securities Trading Limited) and the
Constitution of the Company; and
(d) Unless revoked or varied by the Company in General Meeting, such authority shall continue in
force until the conclusion of the next Annual General Meeting of the Company following passing of
the Ordinary Resolution, or the date by which the next Annual General Meeting of the Company is
required by law to be held, whichever is earlier.
[See Explanatory Note (iii)] (Resolution 12)
11. Authority to offer and grant options and to allot and issue shares under the Excelpoint Share Option Scheme 2014
That pursuant to Section 161 of the Singapore Companies Act, Chapter 50, the Directors of the
Company be authorised and empowered to offer and grant options in accordance with the provisions
of the Excelpoint Share Option Scheme 2014 (the “ESOS”) and (notwithstanding the authority conferred
by this Ordinary Resolution may have ceased to be in force) to allot and issue from time to time such
number of fully-paid shares as may be required to be issued pursuant to the exercise of options under
the ESOS provided always that the aggregate number of shares (comprising new shares and/ or
treasury shares) to be delivered pursuant to the ESOS, when added to the number of new shares issued
and issuable and the number of treasury shares delivered pursuant to all other share schemes of the
Company for the time being in force, shall not exceed fi fteen per centum (15%) of the total issued share
capital of the Company (excluding treasury shares) from time to time, and provided also that, subject to
such adjustments as may be made to the ESOS as a result of any variation in the capital structure of the
Company, and that such authority shall, unless revoked or varied by the Company in General Meeting,
continue in force until the conclusion of the next Annual General Meeting of the Company or the date by
which the next Annual General Meeting of the Company is required by law to be held, whichever is the
earlier.
[See Explanatory Note (iv)] (Resolution 13)
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016 105
NOTICE OF SIXTEENTHANNUAL GENERAL MEETING
12. Authority to offer and grant awards and to allot and issue shares under the Excelpoint Performance Share Scheme
That pursuant to Section 161 of the Singapore Companies Act, Chapter 50, the Directors of the
Company be authorised to offer and grant awards in accordance with the provisions of the prevailing
Excelpoint Performance Share Scheme (the “EPSS”) and (notwithstanding the authority conferred by
this Ordinary Resolution may have ceased to be in force) to allot and issue and/ or deliver such number
of fully-paid shares in the form of existing shares held as treasury shares and/ or new shares as may be
required to be delivered pursuant to the vesting of the awards under the EPSS, provided always that the
aggregate number of shares (comprising new shares and/ or treasury shares) to be delivered pursuant
to the EPSS, when added to the number of new shares issued and issuable and the number of treasury
shares delivered pursuant to all other share schemes of the Company for the time being in force, shall
not exceed fi fteen per centum (15%) of the total number of issued shares in the capital of the Company
(excluding treasury shares) from time to time, and that such authority shall, unless revoked or varied by
the Company in a General Meeting, continue in force until the conclusion of the next Annual General
Meeting of the Company or the date by which the next Annual General Meeting of the Company is
required by law to be held, whichever is the earlier. (Resolution 14)
13. Renewal of Share Buyback Mandate
That for the purposes of Sections 76C and 76E of the Singapore Companies Act (Chapter 50) of
Singapore, the Directors of the Company be and are hereby authorised to make purchases or otherwise
acquire issued shares in the capital of the Company from time to time (whether by way of market
purchases or off-market purchases on an equal access scheme) of up to ten per centum (10%) of the
total number of issued shares (excluding treasury shares) in the capital of the Company (as ascertained
as at the date of Annual General Meeting of the Company) at the price of up to but not exceeding
the Maximum Price as defi ned in paragraph 2.3.4 of the Appendix to the Notice of the Annual General
Meeting to shareholders of the Company (the “Appendix”) in accordance with the Terms of the Share
Buyback Mandate set out in the Appendix, and this mandate shall, unless revoked or varied by the
Company in General Meeting, continue in force until the conclusion of the next Annual General Meeting
of the Company or the date by which the next Annual General Meeting of the Company is required by
law to be held, whichever is earlier.
[See Explanatory Note (v)] (Resolution 15)
By Order of the Board
Tan Cher Liang
Wong Yoen Har
Company Secretaries
Singapore, 21 March 2017
Explanatory Notes:
(i) The Director’s Fee is the pro-rated fee payable to the additional Independent Director appointed on 28 September 2016.
(ii) Subject to the approval of Ordinary Resolution 10 in item 7 above, share awards will be granted to the Independent Directors as
part of their Directors’ Fees which will consist of the grant of fully-paid shares under the Excelpoint Performance Share Scheme with
no performance and vesting conditions attached. The Company will announce details of the share awards in accordance with Rule
704(29) of the Listing Manual of the SGX-ST. The relevant Directors and their respective associates will abstain from exercising any
voting rights on Ordinary Resolution 10 in item 7 above.
EXCELPOINT TECHNOLOGY LTD ANNUAL REPORT 2016106
NOTICE OF SIXTEENTHANNUAL GENERAL MEETING
(iii) The Ordinary Resolution 12 in item 10 above, if passed, will empower the Directors of the Company, effective until the conclusion of
the next Annual General Meeting of the Company, or the date by which the next Annual General Meeting of the Company is required
by law to be held or such authority is varied or revoked by the Company in a General Meeting, whichever is the earlier, to issue
shares, make or grant Instruments convertible into shares and to issue shares pursuant to such Instruments, up to a number not
exceeding, in total, 50% of the total number of issued shares (excluding treasury shares) in the capital of the Company, of which up
to 20% may be issued other than on a pro-rata basis to shareholders.
For determining the aggregate number of shares that may be issued, the total number of issued shares (excluding treasury shares)
will be calculated based on the total number of issued shares (excluding treasury shares) in the capital of the Company at the time
this Ordinary Resolution is passed after adjusting for new shares arising from the conversion or exercise of any convertible securities
or share options or vesting of share awards which are outstanding or subsisting at the time when this Ordinary Resolution is passed
and any subsequent consolidation or sub-division of shares.
(iv) The Ordinary Resolution 13 in item 11 above, if passed, will empower the Directors of the Company, effective until the conclusion of
the next Annual General Meeting of the Company, or the date by which the next Annual General Meeting of the Company is required
by law to be held or such authority is varied or revoked by the Company in a General Meeting, whichever is the earlier, to offer and
grant options and to allot and issue shares pursuant to the ESOS, the details of the ESOS and a summary of the rules of which
are set out in the Company’s circular to shareholders dated 2 April 2014, provided always that the aggregate number of shares
(comprising new shares and/ or treasury shares) to be delivered pursuant to the ESOS, when added to the number of new shares
issued and issuable and the number of treasury shares delivered pursuant to all other share schemes of the Company (if any), shall
not exceed fi fteen per centum (15%) of the total issued share capital of the Company (excluding treasury shares) from time to time.
The number of shares to be issued under the ESOS and EPSS collectively, subject to the existing maximum limit of fi fteen per
centum (15%) of the total issued share capital of the Company from time to time.
(v) The Ordinary Resolution 15 proposed in item 13 above, if passed, will empower the Directors of the Company effective until the
conclusion of the next Annual General Meeting of the Company or the date by which the next Annual General Meeting of the
Company is required by law to be held, whichever is earlier, to repurchase ordinary shares of the Company by way of market
purchases or off-market purchases of up to ten per centum (10%) of the total number of issued shares (excluding treasury shares)
in the capital of the Company at the Maximum Price as defi ned in Appendix to the Notice of the Annual General Meeting to
shareholders. The rationale for, the authority and limitation on, the sources of funds to be used for the purchase or acquisition
including the amount of fi nancing and the fi nancial effects of the purchase or acquisition of ordinary shares by the Company
pursuant to the Share Buyback Mandate on the audited consolidated fi nancial accounts of the Group for the fi nancial year ended 31
December 2016 are set out in greater detail in Paragraph 2 of the Appendix.
Notes:
1. (a) A member who is not a relevant intermediary, is entitled to appoint one or two proxies to attend and vote at the Annual
General Meeting (the “Meeting”).
(b) A member who is a relevant intermediary, is entitled to appoint more than two proxies to attend and vote at the Meeting, but
each proxy must be appointed to exercise the rights attached to a different Share or Shares held by such member.
“Relevant intermediary” has the meaning ascribed to it in Section 181 of the Companies Act, Chapter 50.
2. A proxy need not be a member of the Company.
3. The Instrument appointing a proxy or proxies must be deposited at the Registered Offi ce of the Company at 15 Changi Business
Park Central 1, #06-00, Singapore 486057 not less than forty-eight (48) hours before the time appointed for holding the Meeting.
Personal data privacy:
By submitting an instrument appointing a proxy(ies) and/ or representative(s) to attend, speak and vote at the Meeting and/ or any
adjournment thereof, a member of the Company (i) consents to the collection, use and disclosure of the member’s personal data by the
Company (or its agents) for the purpose of the processing and administration by the Company (or its agents) of proxies and representatives
appointed for the Meeting (including any adjournment thereof) and the preparation and compilation of the attendance lists, minutes and
other documents relating to the Meeting (including any adjournment thereof), and in order for the Company (or its agents) to comply with
any applicable laws, listing rules, regulations and/ or guidelines (collectively, the “Purposes”), (ii) warrants that where the member discloses
the personal data of the member’s proxy(ies) and/ or representative(s) to the Company (or its agents), the member has obtained the prior
consent of such proxy(ies) and/ or representative(s) for the collection, use and disclosure by the Company (or its agents) of the personal
data of such proxy(ies) and/ or representative(s) for the Purposes, and (iii) agrees that the member will indemnify the Company in respect of
any penalties, liabilities, claims, demands, losses and damages as a result of the member’s breach of warranty.
EXCELPOINT TECHNOLOGY LTD.(Company Registration No. 200103280C)
(Incorporated in the Republic of Singapore with limited liability)
PROXY FORM
(Please see notes overleaf before completing this Form)
I/We
of being a member/members of Excelpoint Technology Ltd. (the “Company”), hereby appoint:
Name NRIC/Passport No. Proportion of ShareholdingsNo. of Shares %
Address
and/or (delete as appropriate)
Name NRIC/Passport No. Proportion of ShareholdingsNo. of Shares %
Address
or failing the person, or either or both of the persons, referred to above, the Chairman of the Meeting as my/our proxy/proxies to vote for me/us on my/our behalf at the Sixteenth Annual General Meeting (the “Meeting”) of the Company to be held at Grand Mercure Roxy Singapore, 50 East Coast Road, Roxy Square, Meyer & Frankel Room, Level 3, Singapore 428769 on Wednesday, 5 April 2017 at 3.00 p.m. and at any adjournment thereof. I/We direct my/our proxy/proxies to vote for or against the Resolutions proposed at the Meeting as indicated hereunder. If no specifi c direction as to voting is given or in the event of any other matter arising at the Meeting and at any adjournment thereof, the proxy/proxies will vote or abstain from voting at his/her/their discretion, PROVIDED ALWAYS that the Chairman of the Meeting shall in any event abstain from voting on Ordinary Resolution 15. The authority herein includes the right to demand or to join in demanding a poll and to vote on a poll.
(Please indicate your vote “For” or “Against” with a tick [] within the box provided.)
No. Resolutions relating to:
Number of Votes
For(1)
Number of Votes Against(1)
Ordinary Business1 Directors’ Statement and the Audited Financial Statements for the year ended 31 December 2016
2 Payment of proposed fi rst & fi nal ordinary tax exempt one-tier dividend
3 Payment of proposed special tax exempt one-tier dividend
4 Re-election of Sunny Wong Fook Choy as a Director
5 Re-election of Alan Kwan Wai Loen as a Director
6 Re-election of Herbert Kwok Fei Lung as a Director
7 Re-election of Tonny Phuay Yong Choon as a Director
8 Re-election of Joanne Khoo Su Nee as a Director
9 Approval of Director’s Fee of S$13,013.70 in cash to an Independent Director for the fi nancial year ended 31 December 2016
10 Approval of Directors’ Fees to the Independent Directors for the financial year from 1 January 2017 to 31 December 2017 comprising payment of S$248,000 in cash and the award of 80,000 ordinary shares under the Excelpoint Performance Share Scheme
11 Re-appointment of Messrs Ernst & Young LLP as Auditors
Special Business12 Authority to issue shares in the share capital of the Company
13 Authority to offer and grant options and to allot and issue shares under the Excelpoint Share Option Scheme 2014
14 Authority to offer and grant awards and to allot and issue shares under the Excelpoint Performance Share Scheme
15 Renewal of Share Buyback Mandate
If you wish to exercise all your votes “For” or “Against”, please tick within the box provided. Alternatively, please indicate the number of votes as appropriate.
Dated this day of 2017
Total number of Shares in: No. of Shares(a) CDP Register
(b) Register of Members
Signature of Shareholder(s) or, Common Seal of Corporate Shareholder
IMPORTANT:
1. A relevant intermediary may appoint more than two proxies to attend the Annual General Meeting and vote (please see note 4 for the defi nition of “relevant intermediary”).
2. For investors who have used their CPF monies to buy the Company’s shares, this Annual Report is forwarded to them at the request of their CPF Approved Nominees and is sent solely FOR INFORMATION ONLY.
3. This Proxy Form is not valid for use by CPF investors and shall be ineffective for all intents and purposes if used or purported to be used by them.
Notes:-
1. Please insert the total number of Shares held by you. If you have Shares entered against your name in the Depository Register (as
defi ned in Section 81SF of the Securities and Futures Act, Chapter 289), you should insert that number of Shares. If you have Shares
registered in your name in the Register of Members, you should insert that number of Shares. If you have Shares entered against your
name in the Depository Register and Shares registered in your name in the Register of Members, you should insert the aggregate
number of Shares entered against your name in the Depository Register and registered in your name in the Register of Members. If no
number is inserted, the instrument appointing a proxy or proxies shall be deemed to relate to all the Shares held by you.
2. A member of the Company entitled to attend and vote at a meeting of the Company is entitled to appoint one or two proxies to attend
and vote in his/her stead. A proxy need not be a member of the Company.
3. Where a member appoints two proxies, the appointments shall be invalid unless he/she specifi es the proportion of his/her shareholding
(expressed as a percentage of the whole) to be represented by each proxy.
4. A member who is a relevant intermediary entitled to attend the meeting and vote is entitled to appoint more than two proxies to attend
and vote instead of the member, but each proxy must be appointed to exercise the rights attached to a different Share or Shares held
by such member. Where such member appoints more than two proxies, the appointments shall be invalid unless the member specifi es
the number of Shares in relation to which each proxy has been appointed.
“Relevant intermediary” means:
(a) a banking corporation licensed under the Banking Act (Chapter 19) or a wholly-owned subsidiary of such a banking corporation,
whose business includes the provision of nominee services and who holds shares in that capacity;
(b) a person holding a capital markets services licence to provide custodial services for securities under the Securities and Futures
Act (Chapter 289) and who holds shares in that capacity; or
(c) the Central Provident Fund Board established by the Central Provident Fund Act (Chapter 36), in respect of shares purchased
under the subsidiary legislation made under that Act providing for the making of investments from the contributions and
interest standing to the credit of members of the Central Provident Fund, if the Board holds those shares in the capacity of an
intermediary pursuant to or in accordance with that subsidiary legislation.
5. Completion and return of this instrument appointing a proxy shall not preclude a member from attending and voting at the Meeting. Any
appointment of a proxy or proxies shall be deemed to be revoked if a member attends the meeting in person, and in such event, the
Company reserves the right to refuse to admit any person or persons appointed under the instrument of proxy to the Meeting.
6. The instrument appointing a proxy or proxies must be deposited at the registered offi ce of the Company at 15 Changi Business Park
Central 1, #06-00, Singapore 486057 not less than 48 hours before the time appointed for the Meeting.
7. The instrument appointing a proxy or proxies must be under the hand of the appointor or of his attorney duly authorised in writing.
Where the instrument appointing a proxy or proxies is executed by a corporation, it must be executed either under its seal or under the
hand of an offi cer or attorney duly authorised. Where the instrument appointing a proxy or proxies is executed by an attorney on behalf
of the appointor, the letter or power of attorney or a duly certifi ed copy thereof must be lodged with the instrument.
8. A corporation which is a member may authorise by resolution of its Directors or other governing body such person as it thinks fi t to act
as its representative at the Meeting, in accordance with Section 179 of the Companies Act, Chapter 50 of Singapore.
PERSONAL DATA PRIVACY:-
By submitting an instrument appointing a proxy(ies) and/or representative(s), the member accepts and agrees to the personal data privacy
terms set out in the Notice of Sixteenth Annual General Meeting dated 21 March 2017.
General:-
The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperly completed or illegible, or
where the true intentions of the appointor are not ascertainable from the instructions of the appointor specifi ed in the instrument appointing a
proxy or proxies. In addition, in the case of Shares entered in the Depository Register, the Company may reject any instrument appointing a
proxy or proxies lodged if the member, being the appointor, is not shown to have Shares entered against his name in the Depository Register
as at 72 hours before the time appointed for holding the Meeting, as certifi ed by The Central Depository (Pte) Limited to the Company.
15 Changi Business Park Central 1#06-00Singapore 486057T +65 6741 8966 F +65 6741 8980www.excelpoint.comCompany Registration No. 200103280C